The American Dream used to be associated with retiring in your late 50s or early 60s and living a relaxing, financially stable life in your older existence. Seniors would get a reprieve after decades of employment, potentially spend time with their grandkids, and maybe get to experience some new excitement they didn’t get to earlier in life.
This was commonly dubbed “the golden years”. Unfortunately, the pandemic threw a wrench in the traditional retirement plans of millions of Americans, resulting in seniors having to stay with their employers longer or even unretire after leaving their jobs. What can retirees do to prepare for the harsher economic landscape of the U.S.?
Auto insurance for retirees can sometimes be more affordable if older people have a clean driving record. Seniors can also shop frugally and get discounts at certain times of the year. We’ll talk about these strategies and a few others to help assure seniors that there is still the possibility of living a traditional retirement lifestyle in 2023 and beyond.
#1 – Create a Savings Account Earlier in Life
One of the best ways to make sure you’re ready for retirement is to start saving in your earlier years. Young adults in their 20s and 30s can often struggle to save due to current employment and housing circumstances in America, making saving something that will ultimately cover necessary items a top priority.
There are several habits to help you build wealth for the future that can begin in early and middle adulthood, though. If you get a raise at work, don’t immediately splurge on entertainment or other items you’ve been thinking about buying. Calculate a certain percentage of your raise and put it in a savings account for retirement.
Many people have abided by the 50/30/20 budgeting rule for a while now. This is where you spend half of your money on necessities, 30% on entertainment or other items you want, and 20% on savings. These numbers obviously need to be adjusted depending on your personal situation.
Some people might choose to put more of the entertainment money towards savings if they have excess income and don’t have a lot of possessions they desire. Others may need to put more money towards necessities if they have children. No matter your situation, everyone should put a little money into savings earlier on in adulthood.
#2 – Shop for Senior Discounts
It may not seem like much at first glance, but seniors who are aware of discounts targeted towards them can really benefit from the amount of money saved in total from deals. As the pandemic affected everyone differently, many businesses wanted to help vulnerable groups of people with cheaper prices or coupons.
Let’s review some of the best senior discounts at popular shopping locations. Seniors who have an Amazon Prime account can get discounts if they are also part of the SNAP program. This is a government initiative for those living under the poverty line. There are discounts for those living a middle-class life, too.
Kohl’s lets seniors shop at 15% on Wednesdays if they can prove they’re 60 years old or over. Home Depot has a price match guarantee for senior citizens. Fred Meyer allows seniors to get a 10% discount on certain items on the first Tuesday of every month. These may seem like small potatoes, but the discounts add up if you take advantage of all of them at once.
#3 – Get Senior Auto Insurance
Some seniors may not drive as often during retirement because they don’t go to work and commute five-plus days a week. Seniors who only stay close to their homes should consider asking for a pleasure driving discount or a low-mileage plan. These insurance plans are a way for insurance companies to reward you for being a lower-risk driver.
These discounts are best-taken advantage of early in your retirement. People who get into their late 70s and beyond sometimes see increased rates on insurance due to companies having evidence of some seniors getting into more accidents, maybe due to poor eyesight or slower reflexes.
#4 – Create Passive Income
Although many would rather leave that aspect to others when it comes to retirement, that doesn’t preclude creating passive income now through hobbies that bring in money without needing to think too hard about how best to do it. Looking into finding such hobbies could provide financial security throughout your early life years!
If you live to write, consider joining a site like Medium or Vocal. These platforms enable bloggers to monetize their posts long after publication has occurred, creating passive income from them for years afterward. Real estate investing may also bring passive income; just make sure not to invest too much before fully understanding all risks involved.
#5 – Understand How to Handle Debt
Debt, particularly credit card debt, remains a formidable challenge for countless Americans. However, by assimilating effective debt relief techniques early on, one can avoid the precarious situation older Americans face when contemplating a return to work. An essential part is understanding when and which card to utilize, ensuring that debt doesn’t balloon over time.
For seniors grappling with hefty credit card balances, the concept of financial stability may seem distant. Those consistently struggling with credit card management might think about using debit cards or cash and exploring options for credit card debt forgiveness programs. Such programs can offer a reprieve, making a tangible difference in pursuing financial security.
This forces someone to be more frugal and careful because you’re taking money directly from your bank account rather than turning it into debt to pay off later. Younger people should talk to their older relatives about how they handle their finances so it becomes easier to stay debt-free and live a financially liberated life in senior adulthood.
You can see that while it’s become more difficult to be financially stable in your 60s and 70s, it’s certainly not impossible. Smart spending habits, a limitation on debt, and a focus on saving a certain amount of money each month in your earlier years will really shine through once you get to retirement age.
Shawn Laib writes and researches for the auto insurance comparison site, AutoInsurance.org. He wants to help seniors understand some of the ways they can be prepared for retirement.