The following article is written by Marshall Dodson and was first posted on Zing, the official blog for our parent company Quicken Loans. Quicken Loans is America’s largest online mortgage lender closing loans in all 50 states with more than 20 years of experience in the industry.
Congratulations on the successful completion of your career. Now it’s time for a well-deserved break from the 9-to-5 grind. The new possibilities for your day are endless, but with a major change in life such as retirement comes a necessity to be a little more careful, especially when it comes to things like your finances.
While you may have thought ahead and been fortunate enough to put away a good sum of money for your retirement, it’s increasingly important for you to keep a closer eye on expenses. Luckily, we here at Quicken Loans have come up with several ideas to help you make the most of your money once you retire.
Find a Livable Allowance
First and foremost, if you haven’t done so beforehand, you and your loved ones should sit down and figure out what a livable allowance is for you. Take a look at your previous expenses such as groceries, insurance, household expenses (utilities and home improvement) and any hobbies to figure out how much money you’ll need to run your household.
Now that you’re retired, it may just be time for a change. For many, a lifestyle change such as retirement can mean more travel, whether it’s to see family or just to see the world. This often means that upkeep on your home can become an increasing inconvenience, especially as you age. Consider downsizing to either a smaller home or even a condominium. This can mean less upkeep for you and less money out of your pocket. Downsizing also means that you’ll have more money to continue your travels or your hobbies. While this may not leave as much room for you to entertain your guests, the tradeoff you see in your finances could be well worth it.
Raise Your Deductible
If downsizing your home isn’t something you want to consider, there are many other ways to save when it comes to your home. One way is to look at your homeowners insurance. An easy way to spend less money on homeowners insurance is to explore raising your deductible.
If you still owe money on your home loan, it may make sense for you to refinance your loan with a lower interest rate. Doing so may save you money on your monthly payment. If you take advantage of the Quicken Loans YOURgage, you won’t even have to increase the term of your loan.
Get a Reverse Mortgage
If you’re 62 or older, you could qualify for a reverse mortgage. You could get tax-free* cash from the equity in your home, which you could use for travel, living expenses, medical bills or whatever you want! One Reverse Mortgage makes the reverse mortgage process simple and easy, and they can help you get the most money out of you home.
Limit Your Cable and Internet Package
Entertainment has a cost, and cable can come at a premium, especially if you pay for the premium or movie channels. A good way to save some extra money is to limit the number of premium channels that you have as part of your cable package. If you currently don’t pay for premium channels, there are still options to help you save on your monthly bill. If you have multiple transmission boxes in your home, consider ending the service on one or more of them.
Another great way to save a little extra is to limit your Internet speed or total bandwidth. Many Internet providers offer different packages that vary the speed, quality and size of your Internet connection. Stepping down to a connection that is a little slower or allows fewer downloads can allow you to still function online and save money while you do it.
Sell a Car
This can be hard if you have a significant other that is still working, but if it’s something that you’re capable of doing, it can be a great money saver. Not only could you make some extra money from the sale of the car, but you can save money over the long run because you no longer need to pay for insurance or registration.
Plan Ahead for Travel
Looking to travel? Try traveling during the not-so-busy season to save money. Now that you have extra time, consider flying out in the middle of the week instead of on the weekend. Planning ahead is always a plus, but be aware of all the deals and the best times for travel and booking. Some say that the cheapest time to book airline tickets is six weeks before your intended travel date, at 3:00 p.m.
While this is by no means a complete list of ways to control your spending once you retire, if you use one or more of these methods, you’ll be looking forward to a less stressful retirement.
Have you recently retired? Do you have tips for controlling your spending habits that we didn’t talk about? Let us know in the comment section below.
*Please consult with your financial advisor.