Hi, my name is Val Campbell, and I wanted to take a minute and introduce this article to you. Now, this article came from a show that Brad Krantz and I did talking about side hustles or side gigs and some ideas for people to be able to develop and build into income streams.
Now, we oriented this show towards retirees, but this can be anybody. It can be a mom, it can be a student, this can be a retiree, it can be somebody that's been laid off or at home, or it can be somebody in the prime of their career who just wants insurance against a future business interruption.
Do something that's fun. Do something that builds something you own, a side gig, a side hustle. Now, let's talk about a couple of ideas because Brad and I developed a few there just to show you how creative and fun you can be with it, but let's talk about some other ideas.
Okay, so construction and home repairs, travel and RV experiences, accounting, budgeting and debt repair, business consulting and mentoring, sewing and quilting, gardening and farming, cooking, nutrition, computer skills, computer repairs, coaching somebody through fixing problems on their their devices, gaming. A lot of people out there interested in gaming that would love to have some coaching, fitness, weight loss and yoga, auto repairs, pet care, dog training, house cleaning hacks, breastfeeding or mom help, parenting of teens, arts and crafts, hunting, sports and hiking, skiing.
There's almost an endless source of subjects, and they don't actually even have to be things that you are currently an expert in. They can be something that you have an interest in learning, because if you've got an interest in learning about something, so do other people probably have that interest. So you just need to get in and get involved and get started learning about something, then share what you're learning with other people.
There's so many different ways that you can develop side incomes based on your areas of interest or your skill sets. So I just wanted to introduce this concept to kind of share some of these ideas with you, and I want to thank Jewelbook.com for sponsoring these shows because this is a platform that specializes in helping you market your skills, your side hacks, or your side gigs, right?
This is Val Campbell. Let's dive into the video.
You know, yeah, today's topic which is, um, how do retirees create side income streams? What types of things can they do? How do they do that? And you know, I was thinking about this, we're the kind of the focal demographic in this conversation is going to be retirees, right? But really, no, I don't care what demographic you're in. If you're looking to create side income, side gigs, however you want to turn that, make money from home, whatever the search, whatever the search string is, the this process that you and I are going to go through right here it applies to everybody. You can, you know, the brainstorming. So, so if you if you're tuning into this, I hope you don't just say, well, that's just for retirees. No, we're going to go through a brainstorming process of coming up with ideas, and most of these ideas would apply to anybody. Brad, what are you thinking?
Let me provide some context here. I'm going to, I'm going to do a screen share because I pulled up an interesting article this morning. It's from about a year ago, but I wanted to, uh, yeah, share screen. Yep. Barely. Um, yeah, I can't even read that. So if you look down, if you look down at the bottom corner of the screen, there's a thing to expand. You can expand that to full size. Oh, there we go. Okay. So I found this was interesting, okay? Because the road to retirement is an easy one. Today, the average couple needs nearly $740,000 to survive in retirement. I'm going to guess that depends where you're living in, etc., etc., um, according to America in Seattle, that would be per year. Yeah, that's, I mean, that that's not a big nest egg.
But household, this was was interesting. Households aged 50 to 55 have only saved a rounded up $125,000, and households age 56 to 61 are only slightly ahead with $164,000. Okay? But they're saying despite these dismal numbers, the gig economy spells good news for seniors. Okay? And we can stop sharing there, I guess.
Okay, so let's go ahead and remove that. Okay, so let me ask you a question. This article was from June 25th, 2019, so yeah, a little more than a year ago. Pretty cool. How do you think the economic situation of this last year has impacted everybody along this conversation, but especially, uh, seniors and retirees? How do you think this event should maybe change things from what this number, what this article says?
Well, we have a little thing out there, and I want to expand on this for a minute or so because I, the whole thing, I I'm not as optimistic as where they're going with this article, and I'll tell you why. Number one, um, we have a thing called 401k came out in 1978. It was originally intended for a place for executives that got significant bonuses to places so they didn't get taxed on that amount, so it's a section of the tax code. But the 401k was never intended to be a retirement program, okay? And we got to keep this mind. We very that's very little known about that.
Second part of that is nothing within a 401k is guaranteed. Absolutely nothing. It's a defined contribution. Your employer may or may not match, but it's up to you to put the money in. But the interest rate's not guaranteed, nothing about its guarantee. But that's in large part where most of us have our retirement nest egg. So fast forward to from 2019 to 2020, we just had this thing. I think we were talking about it, Val, COVID-19, economy collapsing. Of course, it's Trump's fault. We got to be clear about that. Um, 401ks went down. They took big dips. I'll say someone went down to about 201k. So if you had 125 to 165,000, that all of a sudden has dipped. The market's gone back up or about even to where we were at this point last year. But if your nest egg's only 125,000, and you're 50, 50, or 55 to 60, you're probably not collecting Social Security yet. To get a side gig, I'm kind of going at what minimum wage, $15 an hour if you're in the U.S., other places we're looking at places like Boise, Idaho, it's eight dollars an hour. That's before taxes. So is a side gig alone gonna really help you? I mean, they're not, they're not being very clear about the tax consequences. And if you're one of those people that has 125,000, maybe now it's down to 70 or 80.
You're gonna, go get it for a minute because I'm confused about what you said. So you, in your comment there, you're talking about a side gig, you're thinking about working at the big box store or something like that, or or being a greeter at at, uh, Joe Mart or something, right? Yeah, from what they're proposing to go get these other jobs, what are you gonna get for as a job? And if your 401k has been significantly reduced, is that income they're really going to help you out? But what I'm reading here, what I'm reading here, not to not to bust your chops or anything, but what I'm reading here is that this article is not talking about getting a second job because it says you've built a wealth of knowledge with all those years in the workforce, so why not put it to good use? Side hustles are available for nearly every industry and skill level. So they're, they're really not talking about going and getting a Joe Mart job. They're talking about develop something you own, develop a, um, you know, but I didn't, see that's what they're saying. I'm just still kind of going, yeah, is every side gig equal? No.
So go ahead, but I'm just trying to lay, I guess, the worst case scenario, saying I'm not sure if some of these quote unquote side gigs are you're going to bring in the kind of money you need if you have a small nest egg. So let's go ahead and continue. I'm just kind of trying to, well, yeah, this is because this is an amazing article, and we'll post the link to this by the way.
What it says here is it says, despite needing gig employment, in other words, now you're retired, okay? Now you're retired, you're still going to need a gig, you're still going to need employment, is the, is the way this article is looking at this. Not this, I'm not saying I agree with this, the article is, but it says despite needing employment to make ends meet in retirement, only 32 percent say they are struggling financially. So, so they're, they're talking about employment. So you've got Social Security, whatever retirement you got, you're talking about a job. Now they're talking about in addition to this, take up your place in the side hustling market. Yeah. And and this is where you and I have a passion, right? It's this idea of a side hustle, not a, not another job, not delivering pizzas, not being a greeter or not whatever. Nothing wrong with that, not saying anything derogatory about those things, right? But the idea of developing a side hustle, something you're doing on your own that you're creating from skills or interest levels. Right. Yep.
So let's talk a little bit about that. Why would somebody who's a retiree, or I mean, it could be anybody, it could be a mom, it could be somebody who's employed right now who's looking for a side gig, but specific to retirees, why would a retiree want to set up some kind of a side gig, a small business, internet based maybe, or or whatever? Why would they want to do that?
Well, let's be realistic. Depending on what your nest egg is, and you know, I will talk from personal experience and from my own studying research, most financial planner will say based on whatever, whatever it is, whether it's 750,000 or million, whatever, if you're taking out four percent, and I've and I've done the numbers on this, Val, if you're taking out four percent, that might be a little bit too much. I've heard people say you're probably gonna need to be closer to three percent if you're trying to live off that nest egg. Um, unless there's another hit in the economy. But let's say a four percent off a million is what, forty thousand? And let's assume he gets Social Security, you know, maybe 12, 1500 a year? I did some numbers for myself. I said that would put me at about 55,000 a year before taxes. That's not a lot of money. It's really not a lot of money.
And I tend to be looking. So I don't know, I don't know what the normal Social Security is right now, but if you if you plan it right and structure it right, I want to say it's somewhere around twenty five hundred dollars a month, right? Well, it depends on what your income levels were, but conservative. But still, when you look at that, if you're taking four percent of a million dollar nest egg and you're getting security, you're still tax on that, and how long is that gonna hold out? I'm thinking you probably need, would be smart to have some additional income coming in to bolster that, because here's an interesting, wealth's what you've got, what you've saved, riches, and I'm just reading real interesting book on the psychology of money, which is a really interesting book, riches is what you're bringing in. So I think you still need a significant income to stay up, and I'll just say, you know, ahead of the curve, because we don't know what's going to happen in the economy. If we get another tanking like COVID-19, that's going to play with depending on what most people have. I, I think it's the, the point I'm making here is I think to be safe, to hedge your situation, you need another side income coming in.
Well, and and so let's just develop that a little bit. First off, I think there's a number of phenomena that that retirees face or that they show an interest in. So we know that there is a tendency for retirees to try and move from the major cities that they're in, like a Seattle. I'll just, we live in Seattle. Unless you've got an awful lot of money, you do not want Seattle to be your primary residential plane, or the east side. You don't want Manhattan to be your primary, you don't want San Francisco, uh, you know, many places in Los Angeles. The cost of living is just too high there.
They're going, you know, you're you're going to struggle with that for most people in retirement. So you're looking at retirement people moving to Arizona, moving to Florida, Idaho, Boise, you know, Montana, places where the cost of living is lower.
To be continued