Running out of money is one of the biggest concerns in the retirement years. Healthcare is expensive and there is yearly inflation to consider for personal expenses. Proper financial planning cannot completely eliminate the risk of running out of money. Retirement is about freedom and enjoying your years without responsibility.
There are several ways in which you can boost the odds that your money will last through your retirement. If you want to stay stress free during your retirement years, here are a few tips.
Lower Fixed Expenses
Your must-have expenses should be minimized – work how you can work with a minimal budget for food, shelter and transportation. If your current home is too big to maintain on your own, then you can consider moving into a smaller home or an assisted living facility that has a fixed payment schedule on a monthly basis. Moving to an assisted living facility will actually save you a lot of trouble and money in terms of upkeep of your home and all the additional expenses that you might incur on repair and maintenance.
Have a Guaranteed Income
Retirement pension alone may not be enough to sustain you through your retirement years. Once you have enough to cover your necessities, the extra income can be saved to help you with healthcare expenses. Set up a guaranteed income stream using your savings and investments. This will give you peace of mind in your retirement years.
Learn to Budget
We all hate budgeting. A budget that includes essentials, money for social activities and savings for rainy day. Having a robust spending plan will ensure that you have enough to meet all your retirement needs. If you do not have a budget for your retirement income, then you do run the risk of running out of money.
Plan your taxes well
Take the help of a professional auditor and accountant to help plan your taxes well. Tax planning in retirement is essential. Working with a pro-active CA will help you make your retirement income last longer.
Account for inflation
Things will get more expensive as you age. Inflation will erode your buying power and force you to make budget cuts that might become uncomfortable. Have plan for inflation and ensure that you factor in the rising costs when you calculate how much retirement income you require.
Adopt a healthy lifestyle
It is important to make healthier choices with your diet as you age. Chronic health conditions that affect seniors can be avoided or controlled with a healthy diet. Spending money on nutritional consultations, regular medical check-ups and medicine management will help reduce your overall spend on healthcare expenses through your retirement.
Plan for Long Term Care
Invest into healthcare insurance and plan for the long term in terms of your investments. You need to find insurance that will support geriatric care and even nursing expenses if you need it. Do not assume that your savings will be enough without insurance. Healthcare expenses can really eat into your savings.
Learn to maximize your savings and investments and review them constantly to ensure that you meet your retirement goals.