Question

If you are retired and not working, what are 3 ways you could generate cash for your spending needs? What are the tax considerations for each option?

Answer 1

Retirement is a good but tough phase, it fells good that you worked throughout your life and now you are free but it feels bad when there is no income after retirement and you have tension of spending on daily needs.

There are some ways to generate cash even after retirement-

1. Before retirement, if you have built a house or property, you can lend that property on rent or you can give one or two rooms on rent to the bachelors who come for study from different countries. You will get income from house property.
2. If you have your retirement savings, a lump-sum amount that you received at the time of retirement, you can invest the amount into fixed deposits so that you can get interest income and your investment will be safe with no risk.
3. You can do freelancing or join some organization for part time or you can be a home teacher also.
4. You can make your hobby as your career after retirement, you can teach music, dance, arts, drawing, acting, sports etc. You can be a mentor or a coach.
5. In your young age, you should do retirement planning so that you can get good amount or regular income after retirement.

Taxation benefit- Government gives deductions, rebate and relaxation to senior citizens in tax. Senior citizens can reduce their tax liability, there are special standard deductions for senior citizens. Health coverage credit benefit is there, credit for elderly and disabled people is there.