For those retirees who have the foresight and luck to enjoy a satisfying career along with the ability to save, retirement can be financially worry-free. They can continue their sensible money ways and enjoy their sunset years.
However, too many retirees today are experiencing an unhappy surprise. What they planned to be a comfortable nest egg a generation ago may require some post-retirement financial budgeting. Therefore, even those with adequate retirement income should practice some financial frugality to make their money stretch as long as possible into the future.
Check your finances regularly
Take an inventory of what’s in your savings accounts each month. For example, current values of your investments as well as your pension and Social Security incomes. Compare the balance with your spending of the previous month to evaluate whether your spending took too much out of your total worth. If so, find ways to cut back in the current and months ahead.
Consult expert financial advice
It may be a benefit if you regularly confer with a financial expert. This could be very important if your portfolio has a significant amount of investments in volatile stocks. The advice may help you make changes to less risky investments and other adjustments as necessary.
Cut back on big expenses
Now that you’re no longer out every day in the working world, there are expenses you can lower or omit completely. Do you need that big, gas-guzzling car, when a smaller, more efficient one is adequate? Consider doing more walking, not only to save on car expenses, but also as a way to keep healthy.
You won’t need the quality and changes of clothing, especially if your retirement home is in a relaxed sunshine area or senior community. If your house has become an empty nest, then consider selling it and moving to less expensive living spaces.
Shop for bargains everywhere
If you need to cut back on your spending, consider how you shop and spend. Use store specials and the internet to find bargains in clothing, furniture, food and other needs. If you’re a smoker, retirement time is when to finally break the habit. Not only will it improve your health and extend your life, but it will save you thousands of dollars a year to use for more pleasant purchases.
If your retirement income is inadequate?
For those seniors who find they can’t meet their costs of living, there are resources available to help. Don’t wait until conditions become desperate, such as facing foreclosure or eviction. Two of the many available websites can get you started are USA.gov and AARP.
Reverse mortgage: Is it for you?
If you own a home and are strapped for money, then consider a reverse mortgage. It involves a bank or other financial company purchasing your home, but allows you to continue to live in it free of mortgage and rent debt for the rest of your life.
Consider the major disadvantage before you agree to a reverse mortgage. If you own or have significant dollar value in your house and have children or other relatives who would benefit financially from inheriting it, the reverse mortgage would take that away from them.