Considering the average retiree is expected to have less than $20,000 in retirement savings, there’s a good chance you’ll have to pay careful attention to ensure your finances last as long as you do. Here are a few ways to make that happen without sacrificing your standard of living.
Learn to Budget
When your account starts to go down without coming back up, it’s time to make sure that decline is steady and sustainable. The AARP has numerous resources forliving on a budget, but you should start by calculating how much you spend in an average month, how much you have in savings, the amount of Social Security or pension payments you expect, and how long you think you’ll live after you retire.
It’s unfortunate, but seniors are all too often targeted by scammers thinking they’ve found easy prey. Never give your full name, Social Security number, or financial account information to anyone you don’t initiate contact with first. CBS Newsreports that seniors lose billions of dollars each year by investing in fraudulent “opportunities,” including those that promise big payouts in exchange for upfront cash.
Take Advantage of Discounts
While growing older certainly has its drawbacks, there are financial benefits that can help you stretch your retirement dollars. If you like to travel, for instance, the National Parks Service offers lifetime admission for just $80 if you’re over the age of 62. There are also discounts available through certain phone providers and pharmacies. Check with your local grocery store, as many offer “senior days” each week that provide a discount of 10 percent or more. Senior discounts can add up quickly if you know where to find them.
Use Your Life Insurance to Your Advantage
If you have a life insurance policy of at least $100,000, you may be able to cash in on this money once you retire. Harbor Life Settlements explains that selling is a viable option if you can no longer afford the monthly premium, have no dependents, or have a term policy nearing expiration that can be converted to a whole life policy and sold to cover unexpected expenses or to supplement your retirement income. Consider discussing this option with a financial advisor who can help you make an informed decision so you can get the most out of your money.
Ask for Help from Adult Children
Talk to your children about ways they can lend a hand as you learn to live on a limited income. They may be able to help you identify areas you can cut back or make suggestions on ways to watch your money grow. You may also wish to add an adult child to your accounts and make them aware of important details, such as your financial obligations and medical insurance, in case of an unexpected health crisis or cognitive decline.
Know Your Tax Breaks
Even Uncle Sam has compassion for retirees and offers higher deductions for those over the age of 65 as well as credits for elderly or disabled individuals. The AARP also offers free tax preparation for older Americans.
One of the biggest expenses for seniors is healthcare. And while you shouldn’t forgo annual appointments and preventative services, such as teeth cleanings and health screenings, you can strive for a healthy body, which may reduce your chances of getting sick. Stick with common-sense health practices, such as eating healthy foods and staying physically active. You’ll also want to take steps to prevent the flu, stop smoking, and keep your stress levels at a minimum. Kaiser Permanente geriatric specialist Arthur Hayward, M.D. offers more health tips for seniors.
Spring for Good Insurance
Believe it or not, not all Medicare plans are created equally. Determine whether an Original Medicare or Medicare Advantage plan is right for you. You’ll also need to pick prescription drug and supplemental coverage. Compare the benefits of each, but keep in mind that the plan with the lowest monthly premium may actually cost you more in the long term.
You’ve worked your entire life so that you can enjoy your retirement. Making smart financial decisions now can help you do just that.