How The Elderly Can Maximize Their Savings

By on March 24, 2021
savings

As a society, how we take care of our vulnerable people speaks volumes about our values and the robustness of our social society. We know that a vast majority of elderly rely on a fixed income and that that dictates their spending habits and their quality of life. This fixed income is drawn from a mixture of savings, superannuation, and income from investments and other assets that the individual will have accrued over decades spent in the workforce. Whilst we would love to say that all seniors are living comfortably of their savings and are able to afford not only the bare necessities but anything they need to make their retirement comfortable and enjoyable, we know that in America seniors are increasingly economically vulnerable.

A 2019 Congressional report found that the percentage of elderly households with debt increased from 38% in 1989 to 61% in 2016 and that on average these households owed more than $31,000 in debt. Housing security is also a huge concern for older Americans with a Harvard report finding older Americans are expected to be increasing “housing cost-burdened” which is a term used to define paying over 30% of your gross income towards housing costs. The USDA Economic Research Service also found that in 2015 alone 2.9 million households with a senior aged over 65 experienced food insecurity.

It’s clear that as a whole, we need to do a better job at taking care of our elderly and vulnerable populations. If you have an elderly person in your life or if you’re looking at retirement yourself, you’ll want to make sure you’re doing everything that you can to maximize your savings and get the most out of your income. 

Here are our top tips for maximizing your savings and having a financially stable retirement.

Be More Financially Efficient with Utilities

To kick off our list of tips, we have a seemingly obvious but nonetheless important tip — minimize your utility expenses.

What does this mean practically? We’re talking about multiple phone services, TV services, and other network and communication-related expenses.

It’s no secret that smartphones, pay-TV, landlines, and fixed broadband all cost a lot of money month-to-month and, over the course of a year, this certainly adds up. However, you can typically bundle all of these services into one single plan by cutting the landline, switching to a smartphone, and also severing pay-TV for an online alternative.

Today, mobile carriers are offering unlimited data plans with included smartphones for as low as $55 a month which will give you the chance to stream from a mobile device or iPad, without a cable TV subscription.

Choose Social Outings Based On Value

When you’re newly retired you’re often overwhelmed with the sheer amount of time you have on your hands after years of working a 9-5. However, when you decide to make the most of your free time by hanging out with friends and family, we suggest you choose social spots that prioritize value for money. 

Look for local pubs and cafes that have value specials, coffee and bacon and eggs deals, happy hours, and specials. You can also look for cafes with free libraries, free live music, or trivia as ways of combining meals and entertainment. 

To add, you’re getting plenty of social interaction here with your friends and not spending time sitting at home contemplating whether to invest in a new TV service or other costly utility.

Make Use of All Discounts

As a senior, you’re entitled to a tonne of perks and discounts with your senior’s card or other social security entitlements, so we certainly suggest you make use of this.

Seniors and vulnerable adults qualify for benefits that help pay for prescription drugs, medical care, food, heat or utilities. If you’re looking to find out more information about the various benefits available to seniors, you can check out this extensive government resource from the National Council on Aging. 

Open a Senior-Focused Bank Account

As you might already know, the big banks offer a variety of perks for seniors opening a specific bank account.

These accounts are designed to make banking easy and cut almost all setup and management fees to save you as much as possible when it comes to your banking and other financial activities.

We suggest that you gather some more information on accounts that have a 55+ tag and offer zero account fees. These accounts also have far lower overdraw fees than typical accounts which means that when you face an unexpected emergency you’ll be able to make a larger spend without being penalized with a high overdraw fee.

Make Friends with Neighbours

One money-saving activity we highly suggest is getting to know your neighbors and those who live around the area.

As you’ll agree, getting to know the people in your suburb is a great way to make friends and socialize, but also being friendly with your neighbors means that you’ll have someone to call upon should you need something urgently. Whether it be essentials like bread and milk, or for someone to call when you need a lift in a pinch or someone to help you in the event of a medical emergency such as a fall or a stroke, you’ll be able to rely on your friends in the area.

To add to this, you’ll also be able to save a little money by keeping socializing activities in your area, rather than heading into the city and being prone to spending a little more than you anticipated.

Maintain Your Lifestyle On A Budget

One of the more important things on our list is to move forward with a budget that’s focused on you and your lifestyle.

It’s good to start by making a list of all of your essentials and ensuring that you’re able to afford each of these before you move onto luxury products, leisure activities, vacations and basically any of the ‘fun stuff.’

With a budget, you’ll be keeping a close eye on exactly where your money is going, and you will have a good grasp of when you’re in the green or the red for the month.

If you have a smartphone, you can also download applications that automatically link to your bank account and keep tabs on your expenses for the month. With these installed, you’ll be able to see where you’re at with regards to your budget and be able to tell whether you’ll need to pull back for the month.

Having looked at the tips above, it is easy to see that there are many avenues to maximize your savings and keep on top of your expenses as a senior.

All you’ll need to do is watch where you spend, ensure you’re making use of as many of the avenues to save money as possible that are granted by your age, and do your best to automate your expense-tracking and saving activities.

That said, do your best to be pedantic about spending money and you’ll be on the right track to maximizing your savings and making the most of your retirement. Remember that these are your golden years, it’s important to be prudent and practical but overall remember to enjoy yourself!

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How The Elderly Can Maximize Their Savings