The average American is expected to live to 79, which means that many people are living even longer. And when it comes to planning for retirement, it’s always better to be safe than sorry — which means it’s best to start making small (and large) changes now to make sure your money can last three decades or more in retirement, especially given that the future of Social Security is unclear and some believe that Social Security running out is a real possibility in our lifetimes.
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Want advice on how to make your money work for you, save more, spend less and get financially ready for retirement? Here are 100 tips for how to make your money last.
Last updated: Aug. 25, 2021
Know How Much You Need To Save
This first step to ensure you won’t be running out of money in retirement is to have a realistic sense of how much you’ll actually need.
You can use online calculators to help you get a sense of how much you might need once you retire and aren’t making a salary through work.
Meet With a Financial Advisor To Come Up With a Long-Term Plan
With the current average life expectancy, if you retire at age 65, you can expect to live for close to another two decades. If you want to be ready for those two decades, it’s in your best interest to work with a financial advisor now to plan for that future.
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Research Your Savings Options
All savings accounts are not created equal. Like anything in life, you need to research savings accounts to make sure you’re using the best one for your needs. By using one that offers a high annual percentage yield, you can make the most of your money.
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Find a Financial Accountability Partner
Recruit a family member, partner or friend to be your financial accountability partner, and check in regularly about your spending, saving and budgeting. Having to talk about your behavior with another person can help keep you on track.
Take Micro-Actions To Improve Your Financial Literacy
It can be easy to improve your financial literacy a little at a time. If you’re driving to work, consider listening to financial education podcasts. Doing little money tasks throughout your days can help to improve your overall financial literacy.
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Start Saving as Soon as You Can
Compound interest is your friend. The sooner you can start saving, the better. Even if you’ve been in the workforce for a while, it’s never too late to start saving. But start now.
Automate Your Savings
By automatically putting part of your paycheck into a savings account, you will be less tempted to spend it. If that money is never in your checking account then you won’t miss it or accidentally spend it without thinking.
Save Any Cash Windfalls
When you get a tax refund, bonus or other cash windfalls, there’s a temptation to “treat yourself.” Avoid this temptation and save it instead — your future self will thank you.
Don’t Discount Loose Change
Loose change adds up. Anytime you pay in cash and receive change back, put it away to cash in once you’ve got a nice pile. You’ll be surprised how quickly change can become a good amount of money.
Build an Emergency Fund
It’s not a case of if an emergency will happen, it’s when an emergency will happen. And when that emergency hits, you’ll want to be prepared to handle the financial impact so that the emergency doesn’t hurt you any more than it has to.
Keep Your Emergency Fund Separate From Your Checking Account
You’ll want your emergency fund to be easily accessible, but you don’t want to combine it with your checking account that you use for regular bills and shopping. Keep your emergency fund separated and untouched until needed.
Diversify Your Savings Strategy
Consider spreading your savings across high-dividend savings accounts, money market accounts and certificates. By doing so, you’ll have some money that’s easily accessible and some money that’s tied up but gaining higher dividends.
Track Your Spending
If you’re going to fix your spending, you first have to know how you’re spending. By tracking where your money is going, you’ll be able to spot areas where you can cut back.
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Spend Less Than You Earn
It’s simple: Spend less than you earn. By doing so, you will always have a little money left over.
Create a Monthly Budget and Stick To It
Make sure you know exactly how much money you have coming in and how much you have going out. Stick to a budget to make sure expenses are staying in a reasonable range that allows you to save and invest a portion of your income every month.
Make Sure Savings Is Part of Your Budget
Prioritize savings or it’s likely it will just be pushed to the side. Budget for it so that it’s part of your financial plan every month.
Try the 50/30/20 Budget
Under this budgeting rule, 50% of your income is for fixed expenses, like your mortgage and car payments, 20% is for your savings goals and 30% is for variable expenses or the fun stuff you want to do. If you’re having trouble budgeting, this rule is one worth trying out.
Use Credit Cards as Little as Possible
Credit cards can be great, but they can also be dangerous for some people. If you’re someone who is likely to overspend with credit cards, it might be better for you to use your debit card or cash so that you aren’t spending and paying for it later.
If You Do Use a Credit Card, Use a Cash-Back Card
One of the reasons to use a credit card is the perks. And cash back is a great one — it essentially helps you save money on your purchases. If you can use a card responsibly, a cash-back card is worth using.
Leave Yourself a Financial Love Note
Encourage yourself to think twice before swiping by attaching a Post-it to your most-used credit card with a note to ask yourself, “Do I really need this?”
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Pay Off Your Credit Card in Full Each Month
Interest charges can really take a dent out of your savings, so don’t let charges spill over to the next month.
Differentiate Between ‘Wants’ and ‘Needs’
Not everything is a need. Once you can separate wants from the needs, you’ll find that it’s easy to save money here and there.
When You Splurge On a ‘Want,’ Put the Same Amount Into Savings
Can’t resist the ice cream shop or that new pair of shoes in the store window? It’s perfectly OK to splurge sometimes, but every time you do, put the same amount you spent on the splurge into your savings account. If you can’t afford to splurge and save the same amount, that’s a sign you should skip the splurge.
Think About Purchases in Terms of Hours Worked
You might be less likely to spend if you think of how much work it took to make that purchase. If you want to buy a $100 pair of designer jeans and you make $20 an hour, consider whether those jeans are really worth five hours of work, or if there’s a better way to spend that hard-earned cash.
Even though there are some things you just need, like food, clothing and a roof over your head, there are still ways to save on those expenses. By living frugally, maybe by buying second-hand clothing, you can cut some costs on your needs.
Go Small on the Big Things
Items like your car and house can take up a huge part of your budget. But, think about how much you could save by buying a used car instead of new. Or even better, if you have reliable public transportation in your area, it might be worth it to ditch the car altogether.
Reevaluate Your Morning Latte
This is advice you hear all the time. There’s nothing wrong with treating yourself to a latte, but you can quickly save. Not buying one $4 latte each week adds up to $208 saved over the year.
Stop Buying Bottled Water
Instead of buying bottled water, invest in a water filter and a reusable bottle. These small investments will save you money in the long run.
Leverage ‘Found Money’
When you’re able to save money on some of your previous expenses, like if you save $4 every week by not buying a latte, turn that money into a smart money move. Put those $4 every week away into your retirement account or a high-dividend savings account.
Bring Your Own Lunch to Work
Buying lunch out can add up quickly. As often as you can, make your lunch at home and bring it in. An easy way to do this is to make a little extra dinner every night and pack the leftovers up for lunch.
Bring Your Own Food to Other Places
Many popular attractions allow you to bring your own food, including Disney World and the San Diego Zoo. These places often have overpriced concessions, so you can save a lot by packing meals for the family.
When You Do Go Out To Eat, Order Water
Restaurants greatly mark up drinks, especially alcohol. Stick to water when you go out to eat, and indulge in a bottle of wine when you get home instead.
If You Do Want To Get Drinks Out, Go To Happy Hour
Many restaurants offer happy hour specials outside of the traditional 3 p.m. to 6 p.m. schedule. Check for all-night or weekend happy hours to save on drinks and food, even if you work past the typical end time.
Cancel Subscriptions You Don’t Need
Look at all the monthly charges you have on autopay for subscription streaming services, magazines, etc. Evaluate whether you are actually using all of these subscriptions, and cancel the ones you really don’t need.
Renegotiate Cable and Phone Bills
Renegotiating your cable or phone plan, switching to a lower-tier plan or switching providers can save you hundreds.
Or Better Yet, Cancel Your Cable All Together
Everyone knows that cable is expensive. And with all the streaming services available, usually for less, it’s worth considering canceling your cable if you can watch what you want somewhere else.
Shop Around for Insurance
If you’ve been with the same auto or home insurance provider for a while, it’s time to do some comparison shopping. You might be able to find better rates with a new company.
Choosing generic items over name-brand items at the supermarket is one way to keep expenses in check. Name-brand isn’t always best, so if you can find a generic item you like, you’ll save good money over time.
Buy Refurbished Goods
Refurbished electronics are often returned for trivial reasons and are tested by the manufacturer before being resold. Buying a refurbished TV or smartphone can save you big bucks off the sticker price.
Comparison Shop for Prescriptions
Drug prices can vary from one retailer to the next. Check for prices at different pharmacies, as well as warehouse stores and big-box retailers like Target, to find the best price.
Comparison Shop for Gas
Most of us drive every day, which inevitably means we are regularly spending money at the pump. Use the GasBuddy app to find the lowest gas prices near you.
Keep Your Tires Well Inflated
Another way to save on gas is to keep your tires properly inflated, which improves your gas mileage.
Before paying full price for anything, search Groupon and other coupon sites, and search for online promo codes.
Sign Up for Email Offers
Many retailers will offer you a discount or freebie just for signing up for their emails, and they’ll continue to send you other discounts and special offers throughout the year. If there are restaurants or retailers you frequently spend at, signing up for their emails can help you save.
Always Shop For the Holidays After the Holiday
Holiday decor always goes on sale immediately following the holiday. Shop ahead for the next year rather than paying full price for this merchandise right before the occasion.
Shop Using Retailer Apps
Many retailers, including Target and Walgreens, offer discounts through their apps that can help you save on your next purchase.
Take Advantage of New Customer Specials
Many businesses that offer personal care and wellness services, like hair salons and chiropractors, will give a discount to new clients as a way to incentivize you to give them a try. Look for these deals on their websites or Yelp, and you can save on your next appointment.
Don’t Make Impulse Purchases
Whether you’re shopping online or in a store, before you check out, double-check your shopping cart. Go through the items and remove anything you don’t actually need.
Remove Online Payment Information
Online shopping has made it even easier to buy things, that’s why you should be careful with what information you save online. Don’t save any of your credit or debit card information on any shopping sites. That way, you’ll have to take the extra step of adding it before you buy. It might make you think twice about the purchase.
Avoid Shipping Fees
Many retailers offer free shipping year-round, while others have a “buy online, pick up in-store” option. Opt to shop at online retailers that offer these perks to save on shipping fees.
Take Advantage of Tax-Free Shopping Days
Many states offer tax-free shopping days around the back-to-school season, which is a great time to stock up on clothes for the whole family. When you don’t have to pay a sales tax, your money will stretch a lot further.
Shop With Discounted Gift Cards
You can find discounted gift cards at warehouse clubs like Sam’s Club and Costco, as well as through sites including Gift Card Granny, Raise and Cardpool. Buy gift cards for the retailers you shop at most, and you’ll automatically be saving money on your next purchase when you shop with them.
Don’t Use Out-of-Network ATMs
The fees charged by out-of-network ATMs are small, but they can add up over time. It’s always better to go the extra step to visit your own bank or get cash back at the nearest grocery store or pharmacy chain.
Avoid Other Banking Fees
Not maintaining an account minimum or bouncing a check are easy ways to be hit with unnecessary bank fees. Be mindful of your account balances to avoid these charges, which can add up if they happen regularly.
Unplug Your Unused Electronics
Unused electronics that stay plugged in throughout the day can be adding on to your electric bill. Unplug as many appliances as you can when they are not in use to save more money.
Get Creative With Family Activities
It’s easy enough to entertain the whole family for free or very cheap. This can be done with a game night, at-home movie night or another crowd-pleasing activity.
Spend More Time at the Library
Save money on books and movie rentals by borrowing them for free at your local library or through the library’s online services.
Have a ‘No Spend Day’ Once a Week
If you plan your meals ahead, you can easily designate one day a week during which you don’t spend any money.
Make Better Use of Your Free Time
Sometimes it might seem like you don’t have time to make extra money or save money, but it might be possible to find that time. Whether it means skipping watching a TV show after dinner or waking up earlier on the weekends instead of sleeping in, there might be time where you could be working more on your money.
Have Multiple Income Streams
It’s smart to have multiple streams of revenue because then if one starts to fail, you have others to fall back on. Whether this involves your investments or getting a side gig, it’s definitely important to have if you think you’ll be living to 100.
Turn Hobbies Into a Side Gig
If you’re looking for ways to increase your income in order to increase your savings, consider turning your hobby into a side gig. What better way to make money than take something you love to do and find a way to make it profitable?
Start a Business
Starting a business can be hard and take a good bit of money, but if it’s successful, it can be great passive income for you. By owning at least part of your business, when you’re older, you can sit back and enjoy the money it brings in.
Have Some Type of Guaranteed Income for Life
If you don’t start a business, consider other ways to create a lifelong income stream. Some passive income ideas include renting a spare room, your bike or car; real estate crowdfunding; and buying an ATM or billboard.
Sell Stuff You Don’t Need
Yearly spring cleaning can freshen up your home and fatten up your wallet. Use this time to go through closets and drawers to find clothes, electronics and other items that you no longer use, and resell them online or at a consignment shop.
Pay Off High Interest Debts ASAP
High-interest debt can be debilitating for many people. Even if you’re investing money elsewhere, the interest you’re paying on your debt can outweigh the money you’re making. Prioritize paying off high-interest debt as soon as you can.
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Find a Job That Offers Subsidized Healthcare in Retirement
Put Money in a Health Savings Account
Not everyone will be able to find a job that offers healthcare in retirement, but there are other things you can do now to help with the costs of healthcare later on, such as opening a health savings account. An HSA could help you to save now for health expenses you encounter later in life.
Take Advantage Of Employee Benefits
Employers might offer various perks like gym benefits or they could cover your transportation costs. If anything like this is offered that you pay for already, take advantage.
Contribute To a 401(k) — or IRA — as Soon as Possible
Because of compound interest, it’s a good idea to contribute to your 401(k) as soon as you can. Many companies will also just automatically withdraw your contribution from your paycheck, so you won’t even miss the money.
Take Advantage of Employer Matching Contributions
Always take advantage of 401 (k) matching contributions from employers. It’s basically free money.
Aim To Contribute 10% of Your Salary to Retirement Funds
It can be hard to determine how much you should save. Ten percent is a good benchmark to set.
Increase Your Contributions Yearly
Even if you just increase contributions by 1% each year, that will help your savings grow and help you to have a more comfortable retirement.
Regularly Rebalance Your 401(k) To Make Sure It Matches Your Risk Tolerance
Your risk changes as you get older or as the economy changes. This is why it’s important to change adjust your portfolio to your risk. As you get closer to retirement, you’ll probably want to play it safer.
Practice Dollar-Cost Averaging
Dollar-cost averaging involves purchasing a fixed dollar amount of a particular investment on a regular schedule no matter the market conditions. This investment strategy might be one you want to consider if you can regularly invest the money.
Contribute To a Roth 401(k) in Addition To a Traditional 401(k)
A Roth 401(k) is a good option for workers who anticipate that they will be in a higher tax bracket later in life. Although you’ll be contributing after-tax dollars to the 401(k), you won’t have to worry about taxes on the withdrawals when you’re older.
Choose Low-Fee Investments for Your Retirement Accounts
By choosing funds with low expense ratios, you won’t be losing money to these other costs. More of your invested money will actually be going toward the investments.
Ask For What You Deserve at Work
If it’s been a while since you got a raise and you think you deserve one, set up a meeting with your manager to discuss a possible pay bump. If you don’t, you could be stuck making the same earnings for years — which means your finances will be stuck too. The worst you could hear is “no.”
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Invest Your Raise Instead of Spending It
When you get a raise at work, don’t start spending it or work it into your budget. Put that extra money away — whether you add it to your 401(k) or a Roth IRA, it’s a smart move to save and invest it than to increase your standard of living.
Invest In Stocks
The stock market can go up and down, and while you can lose money in it, you can also make solid gains with smart investments. If you’re in the market long enough, you can ride out the waves and come out on top.
Invest In Annuities
Annuities can provide guaranteed income. A longevity annuity is a stream of payments that begins when a person reaches a certain advanced age, say 85. And then those payments continue until the individual passes away. If you end up purchasing your annuity early enough in life, this guaranteed income can come at a reasonable cost.
Invest In Asset Classes That Are Adjusted for Inflation
Inflation means that things will cost more in the future, when you retire. That means that you need to prepare your savings for that. Consider having some assets like real estate, hard assets or Treasury Inflation Protected Securities (TIPS) that are adjusted for inflation every year.
Invest In a Rental Property
Rental properties offer you a steady stream of income. And as the years go on, the value of the property will likely increase, which will help you deal with inflation.
Invest In Alternative Assets
Alternative investments like leveraged loans, collateralized loan obligations or asset-backed securities are investments you should consider if you’re looking to make your money last.
Invest In ‘Safe’ Accounts Too
You’ll want to keep some of your investment money safe, so consider putting it in safer places like CDs or government bonds. That way, when the market is down, you still have some money that is growing.
Overall, Take a Balanced Approach to Investing
If you’re interested in investing, you’ve surely heard that you should have a balanced portfolio. Do it. Instead of trying to get rich quick by making risky investments, keep things balanced so that you’ll win in the long run.
Don’t Withdraw Your Money When the Market Is Down
You don’t want to react too quickly to market changes. When the market goes down, try to hang in there, especially if it’s likely that your investments will bounce back.
Live Off the Dividends of Your Investments
It’s a good idea to have dividend-yielding stocks. If you’re lucky, you won’t have to dig into your nest egg as much if you can use the dividends for most of your expenses.
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If You Don’t Have Much Discretionary Income, Start With Micro-Investing
Not everyone can afford to invest in real estate or pricey stocks — but that doesn’t mean you shouldn’t be investing. There are plenty of investment apps to check out like Acorns or Stash. Some will allow you to invest your spare change, which can add up quickly.
Invest In Your Physical and Mental Health
Your health, both physical and mental, is incredibly important. And if you invest in both now, you can save yourself expenses later on. Healthcare can become incredibly expensive as you age, so it’s best to be healthy to start.
But Think Twice Before Signing Up for a Gym Membership
Many gym memberships go unused, and this can end up becoming a wasteful monthly expense. If you know you will actually stick to a regular gym routine, it’s worth the investment, but if you know you will really only go once or twice a month — or never — it’s probably not worth the monthly payment. There are always free ways to work out, such as heading outside for a walk, run, hike or bike ride, or following along with YouTube workouts at home.
Invest In Energy-Efficient Appliances
The upfront costs might be high, but you’re sure to save money over the life of the appliance thanks to the decrease in your electric bill.
Modify or Purchase a Home That’s Aging Friendly
It could be a good idea to buy a home that can accommodate you as you age — such as one with hallways wide enough to fit a wheelchair — or modifying your home so that it can accommodate you in your golden years.
Have a Plan for Long-Term Care
Long-term care could end up being more expensive than you might think. It’s important to plan for it early so that you have time to save up money for it.
Don’t Dip Into Your Retirement Savings Early
The longer you can leave your investments sitting and taking advantage of compound interest, the better. Don’t dip in early to help with your child’s college costs because they have other options. They can always get a loan for school, but you can’t get a loan for retirement.
Extend the Usefulness of Your Employer-Provided Pension Plan
Although pensions aren’t terribly common, if you do receive a pension from your employer, it might make sense to delay drawing on this income stream if payments increase as you wait. If you have other sources of income that you can pull from, it could be wise to let that income stream grow.
Avoid Retiring Too Soon
In order to make your money last until 100, that might mean you should wait longer to retire. The longer you wait, the longer you can be making money to add to your savings and retirement funds. Even if you just work part time, that will help make your funds last longer.
Plan For Downsizing
As you get closer to retirement, you should be thinking about how you can downsize. Whether that means selling your house for something smaller or getting rid of a second car, downsizing can save and make you a lot of money in the long run. Plus, you won’t need all that extra stuff once you’re retired.
Delay Claiming Social Security To Maximize Benefits
For each year you delay taking Social Security — after hitting full retirement age and until age 70 — your monthly check will be larger. If you continue to work or can pull funds from somewhere else, waiting to take Social Security can be a big help in the long term.
Have a Withdrawal Strategy
Just like you plan for retirement, you also want to plan once you’re in retirement. Having a withdrawal strategy is important because you want to withdraw the right amount of money from the right place at the right time so you’re not facing excess fees or other issues. Working with a financial planner can help you to figure out how to manage your withdrawals.
Turn Longevity Into an Asset
If you’re living longer, that also means you have longer to save and invest. Take advantage of that. Save sooner and keep that money in your investments longer. And as you get older, consider working longer or having a side gig to supplement your income. Let these extra years be an asset.
Gabrielle Olya and Molly Sullivan contributed to the reporting for this article.