More people are retiring with less savings than they need to be comfortable. A lot less. 21% of seniors have no retirement savings. About 29% of households 55 and older have neither retirement savings nor a pension. These numbers may seem surprising and even discouraging, but it’s important to remember that it’s never too late to save, even after retirement. Here are some things you need to know about saving after retirement.
Is it too late to start saving? Some last minute tips
It’s never too late to start saving. If you’ve retired and realize you haven’t saved enough, consider these ideas.
Come out of retirement
It may not be possible to return to the last job you had before. There are still work options available. You can take a part-time job in retail or hospitality. If you have always been the crafty type, start selling your work. You can work with a temp agency to get short-term work and commit to saving some of what you earn.
Social Security Drawing Delay
For those born in 1943 or later, there is a strategy that will give you more Social Security. For every year you delay drawing benefits after you reach retirement age, your benefits increase by 8% until you reach age 70. You automatically save more when you delay withdrawal from Social Security.
Consider a reverse mortgage
If you own a home and have equity, you might consider a reverse mortgage. This type of loan is borrowed against the value of your home. You receive funds in a lump sum, line of credit or fixed monthly payment.
Think about what you own, what you need and what you wouldn’t mind. Maybe it’s selling a large house and moving to a retirement community, selling an extra vehicle or selling your designer clothes and handbags. Put what you earn into savings.
Consider social security options for married couples
If you need to purchase Social Security benefits and you are married, you can always increase your savings. The best way to do this is for the higher earner to delay claiming benefits longer and suspend paying contributions. The spouse with the lower income can claim the spousal benefit. This tactic always results in savings, while providing benefits.
Become a roommate
Look for a roommate. You’ll get companionship, a lower cost of living, help with housework (hopefully) and less space to manage.
Reduce your lifestyle and expenses
Take a look at your purchases over the past few months. Identify spending habits that you can eliminate. It could be a subscription you no longer use, or maybe you start cooking more meals at home instead of going out to eat as often. Keep a journal to track your expenses. Note extravagant purchases and find out how to save money.
Move to a place with a lower cost of living
You could save tens of thousands of dollars a year in living costs by moving to a new state, city or even country.
Ask your family for help
You’ve spent years raising your children. If you have a good relationship with them, you can honestly communicate your financial needs and see how they can help. Other family members, such as siblings, may also be able to provide assistance.
Consider public benefits
The National Council on Aging has a benefits check website where you can look at public programs that can help you reduce your expenses. You may be eligible for benefits such as care assistance, transportation, medical assistance and health care.
Look for debt reduction options
If your debt is too much to handle, talk to a financial advisor, credit counseling agency or bankruptcy attorney to discuss your options. You may be eligible for debt relief options that can help you better adjust to life in retirement.