Now that you are about to retire, are you feeling confident about you money? There are so many things to think about during this time and your finances is usually in the forefront. Sometimes, we have a lot of dreams and perceptions about a retiree’s life. When we find that time upon us, we realize that there is a lot lacking and that keeps us from fulfilling the dream retirement that we have always wanted.
If you think that you haven’t done enough in your pre-retirement years and that your money is not in a good position, you don’t have to worry. Although you will stop working full time, there are some things that you can do to help alleviate your situation.
Even if you do not have any financial problems when your retire, money management is still an important task that you should work on. Your ability to earn a lot is no longer possible and you may want to make sure that the resources that you have will stretch and fund your purchases until you need them.
Budgeting your retirement money
If you haven’t guessed it yet, you really need to budget. The question of why is no longer relevant. Now, you need to ask the question how.
Budgeting your retirement money is just like before. There is not much difference except that your resources now would have been greatly reduced. Given that, you need to consider how you will change your spending to make sure that you will live within your means. You basically have an idea about how much you have in your retirement plan and what you are entitled to receive as your Social Security benefits. Take note of this and calculate the monthly amount that you will receive.
If you need to lower your spending, here are two things that you may want to consider.
Relocate. If you used to live in the city because of your work, you may want to think about relocating farther from the metro. Suburban areas have lower cost of living and that can really help you shave off from your total expenses.
Indulge in do it yourself projects. Since you are no longer working, you have all the time to do tasks and chores in the house that you used to hire someone to do. Mow your own lawn, tend to your garden and clean your own place. If these are the things that you used to pay someone to do, well now you have to time to do them yourself. This also includes cooking your own meals. If you used to eat take out food or you dine in restaurants, you now have the time to experiment in the kitchen. That will save you a lot of money too.
How to manage your debts in retirement
There are some people that have no choice but to carry their debts into retirement. How can you implement money management if your limited resources will have to share it with your debts?
Here are some tips that will keep your debts from ruining your retirement money.
Enter a debt relief program. There are many debt relief programs that you can go into. Your choice for a debt solution will depend on how much you can afford to pay your dues. When determining the ideal debt payment, make sure you allot enough money from your budget on the things that are important like you health care fund.
Seriously tackle your mortgage. Since this is the type of debt that is usually carried over into retirement because of the long payment period, you may want to seriously pay this down. You have the option to either refinance or go into reverse mortgage with your lender. Find out about both so you can understand which option can work best for you.
Increase your debt payment fund. There are two ways you can increase your debt payment fund. One is to lower your spending. We have discussed that in the previous section. You have to consider removing the unnecessary expenses that you used to enjoy. The other way to increase this fund is by earning more money. Let us expound on that in the next part of this article.
Do you need to earn more money?
Before you start to think about earning more money, you may want to do your research and find out if you are eligible to receive other benefits. You can do your search through the Benefit.gov website. They have a page that works as a great benefit finder tool. By answering a couple of questions, you should be able to narrow down the possible benefits that you can receive from the government and organizations.
But if you find that all of these are still not enough, we have some tips for you to help you make ends meet.
Get a job that you want to do. This is different from what you did in your youth. With all the financial support that you are getting from your Social Security and retirement plan, you are not compelled to work very hard to earn more. Now you just have to work to make sure you have enough for your other needs like debt payments or health care costs. You can use a hobby or work on a less stressful consultancy job.
Get rid of the clutter in your life. We all accumulate a lot of things throughout our lifetime. Maybe its time for you to sell them off and earn some money out of them. Downgrade your life and get rid of the stuff that you do not need and are just accumulating dust.
Invest what you can risk. Another great way to grow your income is to start investing. If you are timid about it, you can actually start small. Invest what you can risk to lose. Look into mutual funds, bonds and stocks. These can be a great source of additional income for you.
Money management does not really stop even when you have retired. Make sure that you stay on top of your finances. That way, you will have more than enough to spend for the remainder of your life.