Retirement can be a long-awaited opportunity to enjoy the things in life people didn’t have time for when working. It’s also a time for older adults to assess their financial situation and adequately prepare for the rest of their lives.
Let’s explore some valuable tips for optimizing savings and sources of income into advanced age.
Beware of Elder Scams
But first, a word of warning about financial scams targeting older people. According to the FBI, seniors lose more than 3 billion dollars each year to elder fraud.
A form of elder abuse, senior scams are numerous and new ones are emerging all the time. Take the time to discover what they are and how you or a loved one can avoid them.
If you or someone you love is the victim of elder exploitation, don’t be afraid or embarrassed to report it immediately. Contact your local Adult Protective Services office, the AARP Fraud Watch Network Helpline at 877-908-3360 or the FBI’s Internet Crime Complaint Center. Additional reporting agencies can be found here.
In cases of identity theft, call your local police and the Federal Trade Commission at 877-438-4338.
Delay Drawing from Social Security
For every year you delay taking out Social Security benefits after your full retirement age, your benefits increase by 8% until you reach the age of 70. Conversely, if you draw benefits before your full retirement age, your benefits will be less than 100%.
Downsize
For many people, their home is their most valuable asset. Downsizing to a smaller, more manageable residence can reap not only considerable profit, it can be freeing to live with less clutter and little or (in the case of a senior living community) no maintenance. In addition to downsizing your home, consider selling a second or even primary car and taking public or shared transportation instead. Brainstorm what other big-ticket items you might be able to do without and sell.
Get a Part-Time Job
Since the pandemic, jobs in certain industries are plentiful. Even for seniors with limited mobility or stamina, there are part- and full-time openings that employers are eager to fill. Older adults are well-suited to positions like bookkeeper, receptionist, office clerk, administrative assistant…the list goes on. A little extra income goes a long way toward a more comfortable retirement.
Save a Dime Today for Dollars Tomorrow
Everyday savings can add up in the long run. Incorporate these saving/earning habits into your regular routine:
- Use coupons and take advantage of senior deals and discounts.
- Sign up for credit cards that offer cash back, travel benefits and other perks.
- Vacation in home shares instead of expensive hotels or resorts.
- Take inventory of the possessions (clothing, jewelry, artwork, etc.) you might be able to sell via online marketplaces. This also helps the downsizing process!
- Attend free entertainment events like concerts and movies in the park, art fairs, etc.
- Turn off streaming services you’re not currently using – they can be activated again at will – and use phone, cable and Internet services that only charge for features you need.
Continue Investing in the Stock Market
The older we get, the less time we have to wait out stock performance; therefore, most new investments seniors make should be less risky. However, it is still wise to include some high-growth investments in your portfolio to protect against inflation.
Reduce Debt
If possible, don’t carry a balance on credit cards and pay bills as soon as possible to avoid late fees. It’s easy to forget to pay a bill on time, so consider setting up automatic electronic payment on your recurring charges.
Consult a Financial Expert
Tax benefits, wills, trusts, annuities, estate planning, powers of attorney…the financial aspects of retirement can be dizzying. Sometimes, it’s money well spent to consult a financial adviser or tax/estate attorney to make the most of your assets well into posterity.
Stay Healthy
Seventy percent of people aged 65+ will need long-term care. Do what you can now to stay as fit and healthy as long as possible.
That said, even the healthiest regime won’t keep most of us from needing some level of care into advanced age. How much it will cost varies greatly on several factors. Many older adults pay completely or partly out-of-pocket for long-term care.
In sum, retirement can be expensive. But with proper planning, your best life is entirely within reach.
