Stretching Your Retirement Dollars
You may worry that being frugal in your retirement will be a big downgrade in lifestyle from what you were used to during your working years. It doesn’t have to be. With just a few changes to your spending habits, you can save money in retirement without sacrificing the lifestyle you’ve worked so hard to achieve.
Frugal living ideas
We all know there are plenty of ways to save money, but some things are so obvious you can classify them as common sense rather than smart spending. Drinking tap water and turning down the thermostat certainly fall into that category.
Other ways to save money just don’t seem worthwhile. Making your own soap or toothpaste will only save you a few pennies and isn’t worth the time (unless you want to do this as a hobby).
The best way to stretch your retirement dollars is by reducing your overall spending.
Here are eight easy ways to save money once you’re in retirement.
1. Think about your priorities and reduce the least important
You don’t have to let go of the things that are the most important to you to save money. Instead, you can figure out what’s least important and make adjustments from there. Let’s say you know that your smartphone’s data plan is one of the most useful expenses you have. You check your email on your phone, you price compare while you are at the store, you listen to streaming radio, and you entertain yourself by reading downloaded books. In this case giving up your data plan for the sake of saving money wouldn’t make sense.
On the other hand, maybe you hardly ever watch live TV – you stream episodes or watch a DVD. Then you’re better off cutting your cable bill and opening a Netflix or Amazon account. With a little thought you can keep the type of lifestyle you prefer, and still save money.
Related: When Your Needs are Actually Wants
2. Take advantage of all the financial support available to you
If you are mainly relying on your government pensions (CPP, OAS), ensure that you also apply for all the support you’re eligible to receive from the various governments:
- federal (GIS, Allowance program, Survivor benefits)
- provincial (income assistance, affordable housing programs) and
- municipal (property tax grants or deferments)
Here’s a guide to the resources available to you by province.
If you lived and worked in a country that has social security arrangements with Canada and you paid into that social security plan you might qualify for International Benefits.
3. Always ask about senior discounts
It can be hard to keep track of every place that offers discounts for seniors, so get into the habit of asking for one. Whether you’re buying lunch, a new piece of furniture, or home insurance, just ask if there are any discounts available. You may not always score a discount, but you’d be surprised at how often you do. The worst they can do is say “no.”
Don’t forget to check the various discounts available with club memberships such as Costco, Canadian Automobile Association (CAA), CARP.
4. Save on meals
Grocery prices keep increasing every year. You already know how to take advantage of sales, buy store brands and in-season produce.
It’s hard sometimes to cook at home for one or two. You could organize a cooking club with other retired friends. Create a simple meal plan, buy groceries in bulk from a wholesale club, split the bill and get together to cook and socialize. It’s fun and everyone leaves with freezer meals for a week or a month.
If you don’t want to give up dining out in nice restaurants, simply adjust the frequency say once or twice a week instead of every day. Go for special occasions only and order what you would normally not eat at home. Or switch to less expensive lunches instead of dinners – or go out for appies.
You and your friends can take turns hosting each other for dinner. Pot lucks are another option.
5. Use coupons
I was never a great coupon user. If I did find ones that were useful, I inevitably forgot them at home. But now couponing is easier than it’s ever been. You no longer have to spend time clipping coupons; you can download them to your cell phone. Spend a few minutes checkingonline coupon sites and digital flyers like Flipp before you head out to the grocery store and you’ll find deals on groceries, health care products and household goods that can easily cut your bill.
6. Shop online
If you’re not accustomed to shopping online, give it a try for basic staples like cleaning supplies, non-perishable grocery items and household items.
Plus, you’ll save money on gas when you’re not driving around town.
7. Price shop for everything
Any monthly bill you pay can be negotiated down if you’re willing to put in the work to find a better deal. Consider shopping around for a better rate on insurance, cable TV and phone plan. Negotiate with your financial planner, or change investments, to reduce costs.
8. Fill your time with free activities
You now have all the free time you’ve been waiting for. Take advantage of it and explore all the great freebies that are available in your community. Check out all the free resources that you can access with your library card. Look into the free programs offered by your city’s Park’s and Recreation department or Senior Centre.
The luxury of time
One of the advantages of retirement is that you control your time. When it comes to spending, this can be a blessing and a curse.
You have a lot more time on your hands and many retirees use that time to shop. Instead, use that time to research and shop around to compare prices, go back to a store to get a refund, or straighten out a pricing error over the phone.
When you were working full-time you may have outsourced some household chores you didn’t have time for. Now you do have the time to tackle those tasks.
The bottom line
The retirement years should be a time when people can do the things they want to do without always being worried about finances. Frugal living in retirement has nothing to do with depriving yourself of a fulfilling life. It’s about retiring smart and being mindful of where you are spending.
That’s one of the ways to make your finances more manageable on an average retirement income.
What ways do you stretch your retirement dollars?