Crowdfunding has been around for quite some time. Initially, people used it to launch their creative dreams. If they needed money for a project, they could reach out to the community for financial support. However, as time passed, more crowdfunding sites sprang up, and the option to focus on different goals became more common. This has led some to consider whether they could crowdfund their retirement. If you’re thinking about going that route, here’s what you need to know.

Is Crowdfunding to Pay for Retirement Allowed?

While what you could crowdfund was once a bit limited, today, nearly anything goes. Many of the associated sites have a stunning number of categories that they support, so it’s possible to launch a campaign for just about any purpose. Once, a man attracted over $55,000 in donations for the creation of a potato salad, after all.

If you want to create a crowdfunding campaign to boost your retirement, you can. This could include raising funds for a general purpose, like handling living expenses, to something more specific. For example, maybe you want help maximizing your 401(k) or IRA contributions in your final years, so your goal is to crowdfund a portion of those payments.

However, you do have to make sure you choose the right platform. Not all crowdfunding sites support the same kinds of campaigns. For example, Kickstarter focuses on creation. “Every project needs a plan for creating something and sharing it with the world,” is a rule on the platform. That means you can’t fund your retirement, in a general sense, here.

In comparison, GoFundMe is more flexible. They don’t mind if people raise money for themselves or a loved one, including requesting money to assist with expenses or empower them to reach specific goals.

Ultimately, you have to use a platform that supports your kind of crowdfunding. Otherwise, your campaign will likely be shut down without much ceremony.

Financial Considerations of Crowdfunding Retirement

If you are going to try to crowdfund all or a part of your retirement, it’s important to understand the financial implications of your decision. First, some platforms charge the fees for hosting a campaign. This can eat into earnings, so it’s essential to examine what fees apply, if any.

When it comes to taxes, you probably don’t have to worry. The money is typically considered a gift, so it doesn’t get calculated as income.

It’s also important to understand that the majority of what you receive will likely come from friends and family. Money can alter the nature of relationships, so it’s wise to take that into consideration before you launch a campaign. Otherwise, reunions and gatherings may end up oddly awkward if someone who gave questions your spending habits after the campaign launches.

Reaching Retirement Crowdfunding Success

It’s important to note that there are no guarantees when it comes to crowdfunding. Plenty of campaigns languish without a single contribution. According to one report, between 69 and 89 percent of the projects, depending on the crowdfunding platform, didn’t reach their goal. A separate report saw that, if a person asked for $20,000 to help pay for cancer treatments, they typically only raised about $5,000.

Often, what dictates whether a campaign succeeds or not is its overall reach. Additionally, whether the story is compelling, garners empathy, or otherwise connects with an audience matters.

If you have access to a large following on social media and that network is generally supportive, there’s a better chance you’ll stir up at least some interest. Similarly, if your story resonates with people and you can put in a significant amount of time promoting it, you’ll see better results.

At times, it may be better to have someone else manage the campaign. The emotional response may be stronger if a younger family member, caregiver, or friend who is providing some care reach out on your behalf. That could lead to higher participation rates, as it makes the campaign seem less selfish.

However, your odds of going viral and amassing a significant amount of cash are incredibly limited. That relies heavily on timing as well as luck. In a way, your campaign has to catch the right person’s eye at the proper moment. Otherwise, it may only circulate through your network, garnering mediocre results.

Is Using Crowdfunding to Pay for Your Retirement Wise?

Ultimately, crowdfunding could help you cover some retirement shortfalls. But the likelihood that it would be enough to cover all of your needs is incredibly small. In most cases, a campaign can provide supplemental money, at best.

However, it also doesn’t hurt to try, especially if you are struggling. Just keep your expectations in check, be appreciative of what you do receive, and seek out other income sources that could help you make ends meet. That way, you can bring several approaches together, increasing the odds that you can retire comfortably.


Would you consider trying to crowdfund your retirement? Would you contribute to someone else’s crowdfunded retirement campaign? Share your thoughts in the comments below.


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