Running out of money is one of the biggest worries for older Australians. Rapidly rising living costs, hefty healthcare expenses, and the threat of a global recession make many retirees wonder whether they’ve saved up enough super to live comfortably in their old age.

Prudent financial planning can’t guarantee a stress-free retirement, but it can help alleviate anxiety. We’ve put together a list of five simple money-saving tips to help you make the most of your nest egg.

1. Downsize Your Home

Many retirees are empty nesters yet continue to live in an enormous, family-sized house. Selling up and moving into a more modest abode (a townhouse or one-bedroom apartment) is the most effective way to top up your retirement fund.

An alternative is to move into a retirement community, which has the added convenience of covering your household and garden chores. Although not as cheap, this option becomes feasible once you factor in the current sky-high property prices for large, standalone homes.

Finally, adventurous retirees with a passion for travel could consider living life on the road. Thousands of grey nomads are renting out their homes and living off-grid in their caravans at free (or low cost) campgrounds.

2. Devise a Spending Plan

A thoughtfully planned retirement budget makes it easier to keep your spending in check. Rather than splurging in the early years, convert your savings into a steady annual income stream.

Vanguard recommends spending no more than 4% of your savings in the first year. After that, consider increasing your annual withdrawals to match inflation—or reduce them if the economy tanks. Studies show that retirees with a fiscally responsible withdrawal plan can stretch their savings to 30 years or more.

You may need to make some lifestyle adjustments to adhere to your annual spending plan. Revaluate and minimise your fixed expenses (housing, groceries, insurance, utilities) and keep close tabs on your luxuries via a spreadsheet or budgeting app.

3. Diversify Your Investments

Don’t be afraid to invest. As the financially-savvy folks at Forbes point out, “If you leave money in the bank, you are losing money each and every day to inflation”. A reluctance to invest will ultimately result in the very thing that’s stressing you out: running out of money. And with the current low interest rates, you won’t see much return from funds left in the bank anyway.

Of course, even the most carefully planned investment can fail—and that’s why it’s so important to diversify. Spread your money across a broad spectrum of industries to safeguard your savings from a recession. Or in other words, “Don’t put all your eggs in the one basket.” Seek help from a financial planner to draft a prudent investment portfolio.

4. Learn Your Entitlements

There’s a silver lining that comes with growing old: the senior citizen discount. Work out what deals you’re entitled to and fill in the paperwork to obtain that coveted senior’s card. Unsure where to start? Senior Discount Cards has an effective, easy-to-use app. Some entitlements are state-specific, so take the time to research what’s on offer where you live.

Older Australians may also be eligible for a Home Care Package. This helpful, federally funded program provides much-needed financial assistance that empowers the elderly to continue living in their own home.

5. Live a Healthy Lifestyle

From a financial perspective, retirement is the worst time to let yourself go. Getting sick is expensive, and even the most comprehensive private healthcare plan will only go so far. But the good news is you can avoid many chronic conditions by adopting a healthy lifestyle.

A balanced diet combined with a regular exercise regime will help ward off high blood pressure, diabetes, high cholesterol, and numerous other nasty conditions. Speak to your GP to devise a safe and effective plan. Also, don’t neglect your screenings. While colonoscopies and mammograms entail a significant upfront cost, they’re much cheaper (and more pleasant) than cancer treatment.

Contact CareAbout Today

If you’re interested in obtaining a Home Care Package, get in touch with CareAbout today. Our expert team can provide in-depth advice on how to apply and take the hassle out of finding providers once your funding has been approved. 

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