• 10 Ways Seniors Can Save Money in Retirement

  • by Austin Quinn
Saving Money in Retirement

Retirement can be a relaxing period in life. Without the stresses of work, many seniors take to new hobbies and live fulfilling lives throughout their retirement. However, an increasing number of seniors face financial difficulties as they approach retirement. Nowadays, saving money is a bigger concern than ever before. If you’re about to retire or have already retired, check out the following tips on saving money.

  1. Create a Budget – You should always know where your money is going. It’s easy to become complacent with your bills, but if you keep up with an efficient budget, you’ll be able to make the most of your money. People are often surprised to see how much money they spend eating out, going to the movies, or golfing. Try cooking more meals at home, renting movies that have already been out for a while, or going golfing during off-times. Regardless of how you choose to act, once you’ve made a budget, you’ll feel more confident and knowledgeable about your finances as a whole.
  2. Take Advantage of Discounts – There are plenty of ways to find discounts as a senior. Many movie theatres, carnivals, retail stores, hotels, sporting events, and other facilities offer reduced prices for seniors. These discounts usually fall between ten to fifteen percent, but they can make a huge difference over time. Every time you’re at the register, ask the cashier about a senior discount.
  3. Evaluate Your Insurance – Just as your interests change with age, so too do your insurance needs. Perhaps you need to find better medical insurance, but you probably won’t need disability insurance if you’re already retired. By selling off an extra car, you won’t need to pay insurance on it anymore.
  4. Relocate – Downsizing your home is a great way to save money on your mortgage, property taxes, insurance, and other maintenance expenses. Depending on how far you go, you may even be able to benefit from a lower cost of living. If you’re looking for ways to buy a new home and make it work for you, consider looking into a HECM for Purchase, a type of reverse mortgage which allows you to buy a new home without worrying about monthly mortgage payments. Just remember, you’ll still have to pay homeowners insurance, property taxes, and home maintenance costs.
  5. Access Your Assets – On the other hand, you still have options even if you don’t want to move. According to the U.S. Census Bureau, the typical American household between the ages of 65-69 has a net worth of almost $200,000. However, after removing home equity from the equation, that figure plummets to a mere $45,000. For seniors looking to access that home equity and make use of it without having to downsize or move elsewhere, the reverse mortgage may provide a solution.
  6. Shave Off the Excess – Entering retirement tends to lower expenses. When you aren’t commuting to work, buying an expensive coffee on the way there, or constantly sending formal clothes to the dry cleaner’s, you can save a lot of money. However, there are plenty of unseen expenses that you could be reducing – or removing completely. Get creative and look for the smaller expenses that, when cut, could save you thousands of dollars throughout your retirement.
  7. Invest Wisely – Investing is a risky business. However, when done right, you could protect your savings from inflation and maybe even earn yourself a profit. Learn to diversify your portfolio, make your 401(k) work for you, do your homework on every stock, be flexible, and don’t forget about alternatives like bonds. While it’s difficult to give concrete advice on such a delicate matter, we recommend that you approach each investment decision with a careful, logical strategy in mind.
  8. Test Yourself – Do a trial run of your projected budget for the next six months. Can you sustain your current lifestyle on 70% of your current income? What about 60% or even 50% of your earnings? Before you make a major, life-altering decision such as leaving your job, make sure that your retirement lifestyle will be sustainable. Learn to make a budget, generate other sources of income, and cut back on unnecessary expenses before you actually pull the plug on your career. In other words, try it before you buy it.
  9. Watch Out for Scams – As technology develops and new devices flood the market, scammers continue to concoct new, unforeseen methods of stealing your hard-earned money. Because so many seniors have built substantial nest eggs over time, fraudsters tend to target seniors more than other groups. Beware of telemarketers, emails from suspicious marketers, and internet viruses.
  10. Make Yourself Malleable – When you’re booking plane tickets to travel across the world, keep an eye out for windows of opportunity. Don’t be afraid to wait for an off-season or choose a smaller hotel down the street from the famous one. Double-check the necessities and ask yourself: do I really need the high-quality paper plates or the most expensive brand of cereal? Once you make yourself malleable, you’ll be able to adapt to major changes such as retirement.