According to statistical research from the U.S. Bureau of Labor Statistics, the average elderly adult spends $49,279 annually. A significant portion of this budget goes to housing, transportation, and food expenses.
As an elderly adult, your income declines while your needs increase. The key to every successful financial plan is having an in-depth understanding of your situation and starting early. Keep reading to learn more about navigating financial decisions as a retired senior.
Plan Your Pension Carefully
A pension is a regular payment that an employee receives as part of their retirement plan. Depending on the type of pension, you can receive payments for life after retiring from work.
For example, if you’re employed in the public sector, your employer might provide a defined-benefit pension that pays a guaranteed monthly amount until you die.
Your pension could be your primary income source after retirement. It’s important to plan carefully and ensure your pension payments cover essential costs such as food, housing, utility bills, medical expenses, etc.
Know Your Benefits
As a senior citizen, you can receive numerous discounts, promos, and other benefits. Many businesses, stores, public agencies, and hospitals offer senior discounts that can help you save money.
Senior citizens also receive free access to public transportation in some states. Further, many organizations provide special grants designed for seniors needing financial assistance. Understanding your benefits and how you can use them could help you manage your finances more effectively.
Protect Yourself from Fraud
Today, everything happens online. From instant communication to financial transactions, the world has become increasingly interconnected. Unfortunately, this also increases the risk of criminals targeting senior citizens.
Be aware of suspicious calls or emails requesting sensitive personal information such as banking details or Social Security numbers. If you’re unsure about a message’s authenticity, contact the company directly using the official number posted on the company’s website.
Downsize Your Lifestyle
Downsizing your lifestyle is one of the best pieces of financial advice for senior citizens. Take time to reflect on what you need and what you can do without. Just because you’re removing some luxuries doesn’t mean you’re decreasing your quality of life. In fact, it does the opposite.
Many senior citizens consider selling their homes and moving to a senior retirement community to lessen their housing expenses. You might also consider selling your car and taking public transportation to save money on fuel, maintenance, and vehicle insurance.
Live Your Best Life in Retirement
Retirement is as good as you make it. Giving up a few pleasures in your life is sometimes the best way to experience the best of what life has to offer. Financial planning is your first step to a successful retirement. With careful planning and wise spending habits, you can make your retirement years rewarding and enjoyable.