Not too long ago, the golden years meant retirees could live off of social security benefits, pensions, and the interest earned from retirement savings. With higher home equity and a lower cost of living, many seniors had everything they needed to live comfortably through their golden years.
Today, few workers retire with a pension, and a constantly rising cost of living, low interest rates, and underwater mortgages are the norm. Most retirees now rely on a fixed income.
The good news is that you don’t have to sacrifice your dreams of a comfortable, enriching life. Check out these tips from Work-At-Home Seniors for thriving on a fixed income!
If you’re still paying for your home, you may have some opportunities to save money on your monthly payments. For example, you could seek refinancing, which would pay off your current loan and replace it with one that has more favorable terms.
Borrowers refinance their homes for debt consolidation, lower interest rates, a higher credit score, and many other reasons. You can also free up cash by decreasing your home equity.
If all your kids have flown the coop, take an honest assessment of your current situation, to determine if your family home is still the ideal place to live? Is it the only house you can imagine living during your golden years, or could you benefit from somewhere that requires less maintenance, while still allowing you to live comfortably?
Many retirees downsize to a smaller, less expensive property. Doing so could free up money for saving and investing and improve your long-term financial plan. You can also lower your property taxes by selling your current home.
Become a Freelancer
Another way to thrive on a fixed income is to give your income a boost. Career Sidekick notes that freelancers are finding success in a wide range of industries and niches these days, and chances are you could put your expertise to good use and make money from home. Here are a few specialties worth considering:
- Content or copywriting
- Web design or development
- Virtual assistants
If you choose to become a freelancer, consider establishing a limited liability company (LLC). This will provide you with liability protection, pass-through taxation, and flexible payment terms. Also, LLCs are easier to set up and manage than some other entities.
Keep a Strict Budget
Living on a fixed income means that you likely have very little room for elaborate purchases. But, as Be The Budget points out, if you prioritize each cost, you can tell your money where it’s going and ensure you have cash left over for discretionary spending.
List out your monthly fixed expenses like utilities, mortgage (or rent), healthcare, and insurance. Then, write down an estimate of your food, gas, entertainment, and other variable expenses. Add your fixed and variable costs together; if the total is not at least 20% less than your monthly income, figure out how to put some of your discretionary spending toward savings.
Find Ways to Save
There are many methods of saving that can help you live comfortably on a fixed income. The key is to identify strategies that will fit your lifestyle (or at least won’t drastically lower your quality of life).
For example: You can reduce utility costs by keeping the lights off and unplugging electronic devices in the house when you’re not using them. You could be mindful of impulse buying and thoroughly evaluate each purchase you make. And you could cancel any subscriptions and memberships you haven’t used in the last few months.
Rethinking your healthcare coverage can also save you money. Some policies, such as Medicare Advantage plans, cost more upfront but offer more benefits and can pay off big in the long run. Speak with an expert to determine the best policy for your needs.
Don’t settle for stressful, subpar golden years. Even if you live on a fixed income, you can set yourself up to flourish and get the most from your life. Start by implementing the tips above, and keep seeking other solutions for improving your financial situation.
Elijah Dawson created lookforjobshere.com Here while he was furloughed from his retail management job at the beginning of the pandemic. With many still looking for work, he hopes his site will assist and motivate them as they look for their next big opportunity.