The Sarcasm Report v.71

Top 10 Tips for a Financially Safe Retirement

Plus, stock prices sometimes plunge. That's why retirees who buy stocks for income should probably limit their exposure to this strategy and stick with large, very stable companies with a history of paying dividends.

Here's a tip. Think Citigroup back in 2007. Stable? It was way too big to fail. Don't forget the decades of rich dividend paying history it had back then either. That just shows the power of the rear view mirror. There's all kinds of fun things to see.

Life insurance really isn't meant to be a retirement plan, but it can be a welcome additional income source for retirees who find they're a bit short each month. The safest policy for the job is one like whole life or universal life that builds cash value on a schedule.

Indeed. You definitely want a safe whole life policy. Those extra commissions on whole life will help keep everyone solvent.

That brings us to CD's and savings accounts.

When it comes to generating income, there's nothing safer or more reliable. While this strategy obviously isn't viable when CDs and savings accounts pay 2%, 1% or even less, it can be a fine option when interest rates are reasonable.

Obviously. You can't be earning 2% safely and reliably when inflation is just 1.2%. Wait for inflation to hit 3.2%. That way you can earn 4% instead. It might feel the same in some ways, but the extra taxes you pay on those inflationary profits will make all the difference.

And since you clearly cannot own CDs and savings accounts right now even though inflation is so low, that leaves you with only one obvious conclusion. You must chase returns elsewhere just like everyone else. Perhaps something that has skyrocketed in price over the past few years? Oil? Gold? Silver? Stocks? With so many obvious choices to choose from, how could you possibly lose?

Working part-time can be a good way to do that while earning extra income. And the only thing at risk is some time.

Time spent looking for work in retirement is time well spent. That's especially true when unemployment is 9.8% and age discrimination is prohibited.

Also keep in mind that gasoline is roughly $3 per gallon. The IRS believes it costs you 51 cents per mile to operate a vehicle. That means you'll want to find a high paying part time job very close to where you live of course.

As an example, if you are earning $7.25 per hour (minimum wage), keep roughly $6 after taxes, you work 2 hours per day, and you accept a job that's 12 miles from your home, then you can expect to net $0. It won't feel like it at first, but it will when your car eventually needs maintenance.

I should probably stop here but I will leave you with a sarcastic haiku.

Financially safe
And yet TIPS are not offered
Snowball's chance in hell