Retirees are in a unique situation. On the one hand, they must find ways to make their existing savings last the remainder of their non-working lives. On the other hand, an individual's retirement years are supposed to be a time when he or she enjoys the fruits of his or her labor. That being said, there are several ways that retirees can stretch their dollars during their retirement years.
Watch Where You Live
While it may sound nice to move to an island or some other fantasy destination upon retirement, it can be quite expensive to do so. After all, real estate prices in exotic locales like Hawaii for instance tend to be quite lofty and often outpace the national average.
Ideally a retiree should seek out states and areas where land and construction costs are affordable. In addition, they should seek regions where property taxes are low as well. There are several potential sources of information that can help the retiree or near retiree determine which cities or states are the most attractive. Realtor.com, for example, allows the user to search property listings based upon city. Listings also typically contain property tax information.
Each year, media outlets will report which cities in America are the most affordable and that can provide retirees with a good base of knowledge as they go about their search. Also, organizations or publications that play to retirees are also usually an excellent source of information and they typically weigh a number of factors. For example, American Association of Retired Persons (AARP) Magazine often contains articles comparing and contrasting cities around the U.S. and their attractiveness to retirees.
Maintenance May Be an Issue
There is often a tremendous amount of pride that goes along with traditional single-family home ownership. In addition, ownership allows for certain freedoms. For example, a person can choose what color to paint his or her house and/or how the or she would like to landscape his or her property.
However, the downside to owning a single-family home or acreage is that it can be quite expensive. Not only are there utility and insurance costs to consider, but there are also maintenance costs. For example, a new roof can easily cost the homeowner thousands of dollars. Other chores, like mowing the lawn and trimming bushes can also be quite time consuming, expensive (the homeowner may have to buy a mower or hire someone at a high cost) and a hassle.
Therefore, retirees that don't have the time, money or inclination to maintain large properties might want to consider a condominium complex or an adult community. While the community may charge a monthly maintenance expense to the owner (so the complex can collectively conduct maintenance), the cost may be a lot less than maintaining a large property on your own.
Would-be condominium owners and/or adult community entrants would be wise to inquire about said maintenance (and other costs if applicable) before purchasing. Also as a tip, newer communities may be less expensive on the monthly maintenance front as things like roofs and lawns are newer and may require fewer repairs. A local realtor should be able to point you in the right direction and give accurate and updated information about communities in areas that interest you.
Travel in Groups
Many retirees like to spend their time traveling, which is a great way to enjoy the fruits of one's labor. However, traveling on your own or with your spouse can be difficult and costly. Consider traveling with tour companies to your intended destination. In addition to the cost advantages (travel companies often purchase tickets in bulk and can pass along savings) a tour company may employ area experts that know the best places to sleep and eat.
A travel agent or the Internet can be helpful in learning about existing tour companies. Friends may also be helpful. Try to talk to someone with prior experience, or that has used the company previously. Such individuals can help direct you toward a reputable travel company that will do a good job and uphold its responsibilities and promises to the trip purchaser.
Take Advantage of Opportunities
Many retailers offer seniors discounts and many retirement developments offer vacation trips at excellent rates. Take advantage of them.
Ask for a senior discount when purchasing anything. What is the worst the retailer can say, no? Often a senior can obtain a discount of 10% on an item or service, which can really add up over time and be beneficial to those on a budget. Entities such as the AARP can also assist their members in determining which outlets or businesses honor discounts.
Sell or Donate Your Junk
Reducing clutter can save on storage costs. In addition, the retiree may be able to score a deduction by donating older furnishings, cars or clothes. This can be particularly useful to retirees that continue to generate an income. If nothing else, it feels good to give and get something in return. After accumulating clothing and other items for a number of years, donations can really add up.
The Bottom Line
A retired person must often walk a fine financial line. People must make sure that they have enough money to last the rest of their lives, but retirement is supposed to be enjoyable. Saving money and stretching dollars is important, and these tips are a great place to start.