5 Ways to Plug Leaks in Your Retirement Budget

Grab your wrench and get started with these five saving strategies to help seal up leaks in your budget and make your fixed income work for your retirement lifestyle.

By Gerald E. McLeod, retired TCDRS Communications Manager

You may be living on a fixed income, but your living expenses are fluid. Cost cutting doesn’t have to require depriving yourself of things you enjoy or need. Instead, it should mean sealing up leaks in your budget. Grab your wrench and get started with these five saving strategies:

1. Track Your Outflow

The first step to getting control of your spending is determining where your money is going. Keep a handwritten or digital log of your expenditures for a month and include everything from soda to bank fees. Monitoring your outflow will also give you a benchmark to measure future savings against.

2. Soak Up Savings

Now that you’re not working for someone else, go to work for yourself. Take the time to scrutinize your bills and statements to get an idea of where to cut expenses to soak up savings. It could be time to ditch your warehouse store membership or family cellphone plan.

3. Reduce Property Drainage

Home and vehicle expenditures are easily the largest drain on your budget, but they can also bring the most opportunities for savings. Utilities, maintenance, mortgage, insurance and taxes can flood any budget. If downsizing your property or moving to a less expensive neighborhood aren’t options, look for age-based tax exemptions and ways to reduce utility and fuel usage.

4. Don’t Pack Your Wrench

Becky Bownds of Country Day Travel in Fort Worth recommends traveling during the “shoulder season”. For U.S. destinations, that’s typically in early spring or early fall. “If school is out, prices are higher,” Bownds says. Also watch for last minute offers by signing up for email notifications from airlines and cruise lines on travel sales.

5. Prevent Future Leaks

Staying healthy can be a huge money saver, but having the right insurance coverage is important too. Shop around for Supplemental Medicare Coverage on an annual basis. Talk with your financial advisor to determine whether you still need additional insurance policies, such as life insurance. Keeping just the policies you need is another way to reduce your ongoing expenses.

Cutting expenses by just $1 a day will net you $365 in a year’s time. That’s far more than a drop in the bucket.

Sources: TheBalance.com, AARP.org, Boldin.com, Money.USNews.com

Personal Finance