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4 Ways Baby Boomers Become Rich in Retirement

Carlos Horta / Shutterstock.com
Carlos Horta / Shutterstock.com

Many baby boomers are unsatisfied with their accumulated wealth after many decades of working away and saving. If you’re not content with your financial situation when you retire, you can still find ways to increase your wealth since there are numerous options for those in their golden years to become rich.

Learn More: Net Worth for Baby Boomers — How To Tell Whether You’re Poor, Middle Class, Upper Middle Class or Rich
Check Out: 6 Genius Things All Wealthy People Do With Their Money

Here are four ways baby boomers can become rich in retirement.

Sponsored: Credit card debt keeping you up at night? Find out if you can reduce your debt with these 3 steps

Work a Part-Time Job or Side Gig

After gaining experience in your field and building expertise, you likely possess many skills that will help you create a new income stream in retirement. Now that you don’t have to devote all of your energy to your day job, you can focus on finding income streams you enjoy.

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“Develop a side gig or part-time work in an area you enjoy,” said Emily Trevino, a business professional who co-founded Wise Insurance. “Boomers have a lifetime of skills and experience that many would pay for.

“Even a small income from a hobby, passion project or consulting can make a big difference over time,” she added. “I’ve seen people launch encore careers that allow them to earn well and enjoy this stage of life. The income compounds and provides more options.”

Some side hustle options Trevino offered: “Tutoring, consulting and driving for a rideshare service are all options. An extra $1,000 to $3,000 a month can really add up over time and be invested for the future.”

The goal is to find an income stream that will provide additional investment funds. As you grow your investment accounts, you increase the likelihood of getting rich in your lifetime.

Explore More: 6 Money Moves To Make When Your 401(k) Hits $1 Million

Pay Off Your Debt

If you have any credit card debt, it could be holding you back from getting rich. You’ll want to focus on paying this down so you have more money to invest. You want to do whatever you can immediately to eliminate all debt from your life and build for the future.

“Pay off any high-interest debt like credit cards to avoid fees and free up cash flow,” Trevino suggested. “Then invest in the stock market, especially in dividend-paying stocks, to generate passive income.”

Continue Investing Your Money

There’s a chance that your wealth isn’t where you want it to be because you haven’t had compound interest working on your side for long enough. With the market fluctuations of the last few years, you’ll want to continue investing your money to increase your chances of getting rich. You don’t want to pause the investments just because you’ve left the workforce, as you still have time for your money to grow.

“Many boomers are too conservative with their portfolios, missing growth opportunities,” Trevino said. “As long as you diversify and accept some volatility, investing wisely can grow your money. I’ve seen properly invested nest eggs triple over a decade or two of retirement.”

Every dollar that you invest today makes a huge difference in your future. With people living longer, you still have plenty of time to get rich in your golden years.

“Even modest and consistent contributions to a low-cost index fund over 10-20 years can grow into a sizable nest egg,” Trevino said. “For example, investing $500 monthly in the S&P 500 for 20 years could generate over $500,000.”

Consider Relocating To Reduce Costs or Monetize Home Equity

Now that you’re no longer tied to your job, you don’t have to remain in the same community. You can research real estate markets to buy a cheaper home and improve the quality of your retirement lifestyle.

“With the kids grown, a smaller home or less expensive area unlocks cash,” Trevino said. “I know folks who have pocketed $500,000 or more by downsizing intelligently.

“Trading a larger family home for a smaller place can free up hundreds of thousands to put in the market. Renting out your old home can also provide rental income.”

If your home has increased in value significantly, you can access more money by tapping into the home equity. You can invest these funds or use them to live your desired lifestyle.

Closing Thoughts

Exiting the workforce doesn’t mean you’re finished building wealth, as there are still many options for you. The key is to make some financial changes early on to give yourself time to get rich in this next stage of life.

“The key is keeping an open and creative mindset in retirement,” Trevino said. “With some diligence and courage, it’s possible to build real wealth, even if you didn’t get there earlier in life. But you have to be willing to disrupt the traditional retirement mindset.”

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This article originally appeared on GOBankingRates.com: 4 Ways Baby Boomers Become Rich in Retirement