It is not unusual for retirees to worry about financial stability. After all, you have likely had a steady paycheck for most of your life. You also likely saw your salary increase over the years, helping you to live comfortably and provide for your family.
In retirement, you may be looking at a reduction in regular income, meaning you’ll have to budget carefully in order to make sure that you have enough money to last the rest of your life. It is unsurprising that a recent survey found that over 60% of baby boomers fear outliving their assets more than they fear dying. Over 90% of those surveyed said that the United States was “somewhat or absolutely” in the midst of a retirement crisis.
Luckily, for those nearing or currently in retirement, the outlook is not completely bleak. There are several measures you can take to avoid running out of money during your golden years. Here are five steps you should take now if you are retired and running out of money.
Write Down Your Income and Expenses
The first way to control your spending is to acknowledge that you have a problem. All retirees should have a firm idea of how much money they can spend each month to prevent financial disaster.
If you haven’t done so, take the time to write down all of your income revenues, including your pension, 401(k), Social Security, and any other retirement accounts. Next, write down all of your expenses. If you pay for things with a credit or debit card, you can easily track your spending online.
Once you have this information, you can set a budget to limit your discretionary spending. Make cuts on things that are not necessary, such as eating out multiple times a week and material purchases. Think of ways you can save money, such as getting rid of cable or meal planning.
Consider a Part-Time Job
Let’s face it, the cost of living in most places is extremely high. It makes it almost unaffordable for someone to thrive on a fixed income. Many retirees offset these costs by working part-time.
The best part about having a part-time job in retirement is that you can choose something that makes you happy. You probably don’t need a full salary to keep you afloat, so you have more options about where and when you work.
Think About Downsizing
Another option for many retirees is downsizing. Downsizing can help you get money if your house has equity, and it can lower your living expenses.
A big house or apartment for a retiree may be more work and money than it is worth. Moving to a smaller home with less upkeep costs can help you stay on budget and thrive. Many cities offer 55+ communities at more affordable prices.
Apply for Public Benefits
There are a number of programs available at the state and federal levels to alleviate some of the costs for seniors. For instance, there are several prescription assistance programs that can help a retiree apply for and receive a reduction on their medications. Cities also often offer things like “Meals on Wheels” or travel support through their senior services department.
Retirees are encouraged to take advantage of these programs. You may also be able to attend free classes and obtain discounts on local attractions.
Make Your Money Work for You
While it may seem counterintuitive, retirement is not necessarily the time to stop investing. Investing wisely can help grow your funds and ensure that you do not run out of money. It is important to speak with a financial advisor who can ensure that you are making sound decisions.
Investing is an easy way to make money without having to take on a side gig. Just be careful with deals that sound too good to be true. Seniors are often targeted for investment fraud scams. Work with a reputable firm and experienced broker. The earlier you start, the better. It is a good idea to regularly complete a financial wellness check to ensure that you are on the right track for a blissful (and fully funded) retirement!
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