Life happens in a blink of an eye and often leaves you wondering how you’re going to afford your golden years. Okay, you don’t need a small fortune to get by, but you want enough to be comfortable. Otherwise, it’s as if all the years you spent working were for nothing, which is disheartening.
Cost-cutting tips for retirement have existed for as long as adults have been retiring, so it’s not as if you’re short of inspiration. However, the tried and tested techniques aren’t always suitable. What if you don’t have a big property to downsize? As a result, the prospect of retiring can be scarier than it needs to be.
Once you stop working, it’s hard to produce extra income, which is why it’s essential to think outside of the box. The tips in this guide won’t be the first that spring to mind, yet that doesn’t mean they are ineffective. If anything, they could be just what you require to lower your expenses without harming your lifestyle.
After all, retirement savings only go so far. With that in mind, please continue reading to learn more about the noon-traditional steps you can take to reduce your retirement costs.
1. Claim For Benefits
The idea that you don’t know about benefits for which you are eligible is a little far-fetched. Nobody likes to leave money on the table, so it’s weird to let government grants and subsidies pass you by. On the flip side of the coin, though, there is the fact that people don’t like to take handouts.
Therefore, it’s common for people to ignore financial help due to a lack of knowledge. A prime example is a house conversion. You might be able to get a bursary from your local authority to convert some areas of your property if they relate to your health. It might not be a lot, but it’s better than nothing.
Another alternative is an aid for veterans. Unfortunately, elderly veterans miss out on up to $2,210 every month in unclaimed veterans’ benefits because they don’t know they are eligible to apply. With the cost of elderly care increasing, this is a lot of money to forfeit, especially when it is your right after serving in the armed forces.
If you’re unsure, the best option is to speak to a legal professional regarding your circumstances. As industry experts, they’ll inform you whether you have a case based on a couple of details.
2. Downsize What You Don’t Need
Usually, downsizing involves a house since a family property is too much for two people when the kids fly the nest. Of course, you might have already invoked this option in a bid to save money, so downsizing your home is out of the question. Still, there are other areas you can focus on, such as your car.
Only 15% of households don’t own a car, and a massive 87% report having a permanently available vehicle. The number of two-car households is soaring, so you could be in a position where you have multiple vehicles on your drive.
Although it’s comfortable, it’s not a smart money-saving tactic. Firstly, the expenses will eat into your budget, even if the car is affordable. Secondly, it’s indulgent. If only one of you is retired, the other can take the vehicle while you use public transport. If you’re both retired, you can split it evenly or use it together.
Downsizing your fleet is harder to organize. However, a small amount of preparation could save you thousands of dollars per year, which is a lot of money when your earnings are low.
3. Cancel Your Life Insurance Policy
Dropping your life insurance plan sounds like a bad idea. You paid for it as a backup so that your loved ones won’t have to worry about money when you’re gone, meaning it still has value. However, this isn’t the full story, not when the average $26-a-month policy is sold to 40-year-olds for a 20-year term.
When you consider the figures, you realize it is a safety for a worst-case scenario. Of course, now that you’re older and you’re children and grandchildren are grown-up, they are no longer dependent on you financially. When you do pass away, the money they receive won’t be essential.
This means you can either cancel it entirely, saving yourself $26 per month for the rest of the agreement, or tweak it to lower your expenses. For instance, you can make it less comprehensive to only cover your partner. As your loved ones will receive everything once you’re both gone, this is a savvy option.
Also, don’t forget that your resources, such as your home and any assets, will be left to your family in your will. Therefore, they will be left with something should you cancel your insurance plan.
4. Redecorate Your Home
The last thing you should be doing is redecorating, or at least that is how it feels when you hear the tip for the first time. But, the process is supposed to help you age in place, something 76% of Americans over 50 plan on doing, yet less than 50% expect to do.
Of course, it makes sense to stay in your current property from a financial perspective. As well as having fewer household expenses – most people pay off their mortgages by retirement age – there’s no reason to fork out a considerable sum on a nursing home. The fact that you are comfortable and get to retain your independence is a bonus.
Simple redecorating hacks are often enough to make your property more hospitable for the elderly. Laying carpet over hardwood flooring is a cost-effective, useful tip that limits the damage of falls. Grab bars and safety mats, on the other hand, provide extra stability without breaking the bank.
Aging in place is not only feasible, but it’s affordable when you target the right areas in your house.
While the tried and tested methods of cutting costs do work, they aren’t always suitable. You have to think outside of the box sometimes, and the advice above is perfect for when you do.