Many retirees plan to travel, relax, and pursue their passions after employment. But making these visions a reality requires a sustainable income. One way to support yourself without working full-time is by earning passive income for retirement. With this strategy, you can make money with minimal effort, leaving plenty of time to enjoy your golden years.

This article explores the best passive income investments and their use in retirement. It also details how annuities can secure your financial future.

What passive income is and why it matters in retirement

Passive income is money earned with little or no ongoing labor. This concept is opposed to active income, which involves directly exchanging your time and effort for money. 

Earning passive income requires some work or investment on the front end, like buying real estate or creating an online course. But eventually, it leads to income with minimal daily effort. Common examples of passive income streams include property rental payments, stock dividends, creative work royalties, and annuity payouts.

Finding passive income sources has become more necessary over time. People are living longer, with many spending 20–30 years in retirement. This increases the need for a reliable income stream to cover ongoing living expenses, healthcare costs, and leisure activities. 

Previously reliable retirement income streams, including Social Security, often don’t fully support retirees. Without reform, some projections warn that Social Security will only be able to cover 76% of scheduled payments in 2037. 

Inflation can worsen this issue — it can slowly reduce purchasing power as workers age, making certain types of retirement investments less reliable. So, creating passive income streams can be an important part of making retirement savings last.

Some income investment options for retirees

Certain investment vehicles offer retirees reliable and consistent income. Here are several options to consider.

Annuities

Annuities are financial contracts with insurance companies. You’ll invest a lump sum or a series of payments, and the insurer guarantees future income payments insurer. Depending on your contract, these distributions can last for a set period or the rest of your life.

While there are multiple types of annuities, fixed options may be ideal for retirees. They guarantee a fixed interest, protect principal, and and can help ensrue consistent cash flow, protecting against outliving your savings.

REITs 

Real Estate Investment Trusts (REITs) own, operate, and finance income-generating real estate or assets and pay dividends to shareholders.. 

Investors can participate in the gains and losses of these real estate assets by purchasing shares of a REIT, often on traditional stock exchanges. REITs offer a method of real estate investing for investors and have special tax considerations that allow it to typically yield higher dividends.

This makes them a source of passive retirement investment income.

Dividend-paying stocks

Building a diversified portfolio of reliable dividend stocks can contribute to a consistent retirement income. Dividend-paying stocks reward shareholders with periodic payments of their profits, in the form of cash or additional shares. Dividends can potentially provide a steady stream of income and contribute to investors' total return. 

As with any other investment, you risk losing money with a dividend paying stock, such as if the company loses value or goes out of business. So, selecting stocks requires careful forethought and research.

High-yield savings accounts and certificates of deposit

For those seeking low-risk, easily accessible passive income, high-yield savings accounts and certificates of deposit are safe, FDIC-insured options. 

Why annuities may be a powerful tool for can be a powerful tool for retirement, as in return for your investment, you can annuitize your contract and receive regular payouts for a guaranteed length of time.

Gainbridge offers annuities specifically designed to meet retirees’ income needs. SteadyPace™, for instance, is a multi-year guaranteed annuity that offers predictable payouts. You’ll know how much to expect as soon as you sign the contract, creating income you can rely on. 

And some products, like ParityFlex™, send you distributions for life, even if your principal runs out. This security offers peace of mind that other investments can’t match.

Best of all, we have a 30-day free-look period — cancel any time, for any reason, in your first month. If you’re searching for a simple, low-risk way to grow your savings, learn more about Gainbridge.

Grow your retirement savings faster with Gainbridge

Passive income allows you to live on your terms without financial worry. From real estate to annuities, the above strategies provide diverse paths to build wealth that works for you. 

Gainbridge simplifies this process — our modern, online annuities offer stable income you can trust. Ready to secure your retirement without paying hidden fees or commissions? Visit Gainbridge and learn how annuities can help build your worry-free future.

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This article is for informational purposes only. It is not intended to provide, and should not be interpreted as, individualized investment, legal, or tax advice. The Gainbridge® digital platform provides informational and educational resources intended only for self-directed purposes

Annuities issued by Gainbridge Life Insurance Company located in Zionsville, Indiana. Guarantees are subject to the financial strength and claims paying ability of the issuing insurance company..