It’s estimated that by 2030, some 73 million Americans, or 20% of the population, will be 65 or older. Between now and then, approximately 10,000 Baby Boomers are expected to retire every day. In the process, they’ll be making the transition from accumulating assets for their later years to spending those assets. Fortunately, there are certain technological innovations that may make retirement less taxing financially.
While some seniors are resistant to the idea of using tech, approximately 50% of older Americans are getting online on a regular basis. They’re doing so via personal computers, laptops, tablets, smart TVs, e-readers and smartphones. Some of the things they’re doing with their devices? Checking their Social Security benefit accounts and managing their bank and credit card accounts. (See: Think You Don't Need to Keep Up With Technology?)
In 2017, the typical 55-to-64-year-old has a median annual retirement income of $62,802. By age 75, the median annual income drops to $30,635. At the same time, things like housing and healthcare tend to eat up a larger share of retirees’ income as they grow older. With that in mind, it's worth getting up to date on the increasing number of tech advancements can make the financial aspects of retirement easier to manage.
1. Ride-sharing Apps
While retiring from the workforce means you’re not driving to the office anymore, that doesn’t necessarily result in lower transportation costs. According to data from the U.S. Bureau of Labor Statistics (BLS), 55-to-64-year-olds spend a mean share of 16.6% of their annual household income on transportation. From ages 65 to 74, they spend 17.1% on transportation.
Using ride-sharing apps like Uber and Lyft can make getting around locally less taxing on your wallet. Uber operates in 545 cities worldwide while Lyft drivers pick up riders in 200 cities throughout the U.S. Utilizing these apps can cut down on how often you need to gas up and minimize the amount of wear and tear you’re putting on your car. Eventually, they may help you manage without one. (Check out: The Story of Uber.)
2. Smart Watches
Smart watches have a wide range of capabilities, allowing you to do virtually anything that you can do with a smartphone, right from your wrist. That includes managing your checking and savings accounts, shopping online, using GPS to get directions and checking social media accounts. One company has added another dimension by creating a smart watch that’s designed specifically for seniors.
Lively’s smart watch includes features that are geared towards older adults who are health- and safety-conscious. The watch tracks your physical activity throughout the day, sends notification reminders for taking medications and includes a safety alert feature that lets you call for help in a medical emergency.
Staying in good health as you get older is important, particularly from a financial standpoint. The BLS estimates that 55-to-64-year-olds dedicate a mean of 8.8% of income to healthcare, but as they age that nearly doubles to 15.6% by age 75. Using a smart watch to track your activity levels could contribute to better health and fewer doctor visits. (See: 7 Ways to Reduce Healthcare Costs in Retirement.)
3. Prescription Drug Comparison Apps
A significant share of what seniors spend on healthcare centers on prescription drugs. Prescription medication costs rose by 10.43% in 2015, with brand name drug prices rising by 14.77%, specialty drugs increasing by 9.21% and generic drug prices up 2.93%. Medicare Part D can cover some of the cost, but it may not take care of all of it. Having one or more medical conditions that require prescription drugs for treatment could eat up a sizable portion of your retirement budget.
Using a prescription drug comparison app like GoodRX or WellRX can help you find the medications you need at the lowest possible price. These apps offer information on prescription drug prices at thousands of pharmacies, as well as coupons and discounts on selected prescription medications. According to AARP, the average retiree spends more than $11,000 per year on prescription drugs, so every penny saved matters.
4. Coming Soon: Self-Driving Cars
While "autonomous vehicles" haven’t hit the market yet, this is another technological advancement seniors should be tracking. It’s estimated that self-driving cars could eventually save Americans $160 billion worth of gas and lost time spent stuck in traffic each year. Research from McKinsey & Company suggests that self-driving cars could reduce accidents by 90%. Fewer accidents could mean lower insurance costs, which would be yet another financial boon for seniors. And, of course, there comes the time when most seniors can no longer drive. (See: How Google's Self-Driving Car Will Change Everything.)
Finding ways to reduce spending in retirement is important for almost everyone. Technology gives today's retirees tools that previous generations lacked and new ways to save, especially on transportation and healthcare. The more retirees are willing to embrace tech in their later years, the more cash they may be able to keep in their pockets.