Some Tips On How to Earn Extra Money - 3 Ways to Turn Savings Into Extra Income For Your Retirement

Saving for your retirement can be stressful. Finding out that you need to save a lot more money than you thought to maintain your living standard, can raise a sense of panic. Nevertheless, that is what many people are experiencing now, as they get closer to the date of their retirement. But do not despair; you can make extra money with your savings.

However, if generating a stream of cash were that simple, everybody would be doing it. To point you in the right direction, here are three ways to earn extra income on a regular basis:

Dividends
Invest your money in dividend-paying stocks. They pay a portion of their profits directly to shareholders. In the short-term, price gains for stocks are expected to be low, but many companies see their profits improve. This will result in a rise of their dividend payments. If you do not like to search for the best stocks, invest in a mutual fund, which is specialized in dividends. They do the work for you and at the same time, your risk is diversified.

ETF
ETF (exchange-traded funds) are designed to track the performance of certain groups of stocks. Unlike many mutual funds, money managers do not actively run them, so the expenses they charge are much lower compared with an average mutual fund. In the long run, the difference can be substantial. You can earn a lot of money just by cutting costs.

Annuity
An annuity is an investment that will give you a guaranteed income no matter what happens in the stock market. When you get closer to retirement, as an investor you should move from stocks into bonds.

Nevertheless, in today' s economic situation even bonds can suffer sharp price decreases. Therefore, for an assured stream of income, invest in products like annuities and CD' s. Still, there are some disadvantages. Once you buy them, it can be very expensive if you change your mind. Most of them have a long lockup period, so you cannot move your money elsewhere without paying a high fee. Management fees can also be higher than those on other investments.

If you want to reduce the risk that your savings will shrink by investment losses or inflation, use these ways to invest and your money will grow.
However, good investing is boring, but there it is a way to make money fast if you take only a small percentage of your savings.

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