You probably know a friend or loved one who retired with zero savings. And even those who may have managed to save for retirement still didn’t have enough to be secure and comfortable. Or perhaps you’re the one in this situation. This is the unfortunate reality for many Americans.
Northwestern Mutual reports that nearly two out of ten Americans end up with zero retirement savings. What’s even more interesting is that nearly three out of ten older households (age 55 and over) in the United States have nothing in their pension and retirement savings accounts. These are worrying statistics.
Whether or not you have enough retirement savings, it’s important that you plan for financial uncertainties and make the right decisions when it comes to your spending. And if possible, you should consider finding ways to keep earning a substantial income even in retirement. If you’re a senior looking to have a financially stable, secure, and comfortable retirement, below are important tips you can implement to ensure your savings account doesn’t run dry.
Have a Retirement Budget
Look back at your earlier years when you were more energetic and could stay productive for hours. You never imagined that one day you’d be a senior citizen. And even if you did, you thought you’d have much fewer expenses than you had before retirement. Well, here you are and you still have to deal with most of the expenses you had before retirement—housing, healthcare, travel, food, transportation, utilities, etc.
The fact that you’re no longer working doesn’t mean you won’t need money for groceries and other bills. It also doesn’t mean it’s time to sit back and enjoy everything you’ve put in your savings account. It’s not uncommon for senior citizens to go overboard and run their retirement account dry in just a few years. This is a trap you don’t want to get in. And you can avoid it by managing and keeping track of your spending through a budget.
Take Advantage Senior Discounts and Bargains
Picture this: you walk into a local retail business or grocery store with your shopping list. You pick all the items you need then walk to the cashier to pay. But just before you make payment, one of the attendants reminds you that the store offers senior discounts.
From restaurants and movie theaters to airlines, auto services, and grocery stores, there are numerous senior bargains and discounts available. No one will victimize you when you request a senior discount at a local store. In fact, most businesses will be happy to offer you a bargain on your purchase. These discounts and bargains will help you make your retirement savings last longer.
Get out of Retirement
The idea of retiring and never worrying about work can be alluring. However, as you may have already noticed, things always don’t turn out as expected. You may have been so excited about your retirement but perhaps it’s time to rethink your decision to retire and consider going back to work.
And if you’re still working, you may want to reconsider your readiness to retire. Most employers don’t have a problem allowing their older employees to work full-time for as long as they can. However, you need to be a valuable and resourceful employee to stand a chance. If you’re determined to leave formal employment at your retirement age, you may consider working as a consultant in your field. Getting out of retirement will allow you to earn more income, thereby growing your savings.
Consider New Living Arrangements
Most people get to retirement when their kids have grown up, finished school, and possibly moved out to start their own lives. If this is the case for you, chances are you’re living with your spouse or alone.
The house you’re living in could be the best place you want to be but you already know there’s so much space that you’re no longer using. And you’re spending thousands of dollars maintaining it every year. Why not defray these costs by moving to a smaller home in a less-expensive neighborhood? Or relocating to a senior living community to save money?
If you’re living alone, consider getting someone you can live with and share housing costs.
Consider Refinancing or Consolidating Your Debts
One of the most significant assets you have as a retiree is your home. Everyone is always trying to find ways to minimize their expenses and increase their income/cash flow both before and after retirement. The most interesting thing is that achieving these goals in retirement is not an impossibility, especially if you’re a homeowner.
First, it’s best that you refinance your mortgage to create some room on your monthly budget. And don’t be afraid to tap into your equity. Another financing option that could be useful is a reverse mortgage. You can check out reverse mortgage rates to see how you benefit from this solution. The second important thing you should do is to consolidate all your debts. Why would you have to pay high-interest rates on several loan accounts when you can consolidate all of them into one low-interest loan? It’s time you saved money on the interest rates you’re paying on your monthly debt payments.