01Use Bargains and Benefits
Maybe you don’t feel like a senior, look like a senior, or act like a senior, or maybe you do. Either way—be sure to use age to your advantage.
Numerous age-related discounts are available, such as discount days at your local grocery store, reduced pricing on matinee movies, and lower pricing on dinners at many restaurants.
And don't be shy about asking for a senior discount even if one isn't advertised. Use humor, a smile, a wink, and try something like "I've seen a lot in my life at 55+. What do you say, would these laugh lines qualify me for 10% off?"
If you've never been great at asking for bargains, read the book Getting More, in which Penn law professor Stuart Diamond discusses specific techniques you can use to negotiate upgrades or lower prices on just about anything. I'm not a natural-born bargainer—but every time I've used what he teaches in his book it has worked.
02Make It Fun and Generational
Budgets don't sound like much fun, but games sure do. Instead of a budget, challenge yourself to a game. The goal: find new ways to spend less on your everyday purchases.
Turning this process into a game puts your subconscious to work, so there will always be a part of you on the lookout for ways to save. To accelerate the fun, try keeping a running points system, assigning so many points per x dollar of savings.
Encourage family members to join your new way of thinking. This game could be a perfect opportunity to teach grandchildren better spending habits of their own.
In addition, you can use online sites to find retail discount codes and as the younger ones know the computer, they can help!
The rebel in us makes it hard to stick with a budget that feels like a diet. Instead, frame your spending habits in terms of choices. For example, you can have both the Starbucks coffee and an expensive glass of wine, but perhaps not both on the same day.
Having flex money rather than strict categories works well for many. For example, you may have a pool of $1,000 to spend. If you need new tires that month that may use up a portion. That means other "extras" like that new TV will have to wait until a month where there is more available flex money.
If you can't figure out where to cut back or what kind of trade-offs to make consider using an online budget calculator to look at how much you spend and determine what areas may need adjustments.
You can also try limiting spending at your favorite stores by putting a set amount on a gift card. When it is empty don't allow yourself to reload it for a set amount of time.
04Use Systematic Withdrawals
Once retired, don’t give yourself unlimited access to investment funds. Your money may get spent far too fast if you treat it like a big pot to dip into at will.
Instead, set up a "retirement paycheck" by structuring direct deposits from your investments into your checking account on a monthly or bi-monthly basis.
If the money is coming out of an IRA or other retirement account have both federal and state taxes automatically withheld before you receive your share. This will keep you from getting behind on taxes.
This process of taking regular distributions is often called a systematic withdrawal. Most mutual funds, brokerage firms or financial advisors will provide this type of automatic service for you. Using systematic withdrawals provides a consistent paycheck and helps prevent overspending.
05Consider Housing Alternatives
Roommates offer companionship and help you both save money. If you own a home, consider renting out a room to bring in some extra money. If you rent, consider finding someone to rent with.
You can also lower costs by trading in the high maintenance house/yard for a condo or a patio home in an active living community. Or perhaps you can move somewhere where you can walk to shopping and entertainment. Some people even give up a home altogether, instead going with the RV lifestyle which offers a low cost, flexible way to live and travel.
06Use Public Transportation
When I was a teenager I couldn't wait to get a car. But did you know the trend today is that teenagers aren't so eager to even get their driver's license? Like me, you may have been raised with the idea of a car as a symbol of independence, but what about adopting the new approach and thinking about ways you could go without your own car?
Google maps offers a way to search for public transportation routes online. Or you can invest in a smartphone (Apple offers free workshops to learn how to use iPhones) and then use the smartphone to get rides from new transportation services like Uber or Lyft.
It may be intimidating to learn new technology at first, but once you learn it, you may find it helps you save money. (If you like learning by video try searching YouTube for "iPhone Tips for Seniors".)
For a more traditional approach, talk to neighbors to see if there are opportunities to carpool or find local markets within walking or biking distance.
07Vacation for Less
Travel does not have to be expensive. Senior home exchange allows you to look at creative ways to take vacations by swapping homes with people all over the world. You can even swap motor homes.
You can also search sites like VacationRentals or VRBO (Vacation Rentals by Owner) to find a hotel alternative. These online sites have developed a systematic way for you to rent private homes. Once you check it out, you may even decide to rent your own home out this way from time-to-time.
08Use Government and Non-Profit Organizations
If you need assistance, don't be too proud to ask. Community resources are there for a reason. If you are part of the community, ask for the help you need.
For example, benefit programs, such as the ones you can find on Nutrition.gov, allow you to get quality food for lower prices. You may also want to call your local Area Agency on Aging to find out what non-profits in your area might offer assistance.
You can also try Meals on Wheels, or simply search online by your city such as typing into an online search engine "city of XXXX senior services" to see what comes up.
Not all dollars you spend are equal. Some dollars you spend may provide a good return on investment. Examples? A gym membership and healthy cooking lessons may be the best investment you’ll ever make.
Staying healthy can help lower your medical expenses—in some cases, it can even eliminate the need to use ongoing prescriptions (always subject to your doctor's direction of course!)
To keep your medical expenses down spend time learning how to stay healthy and fit. And don't forget—some of the simplest ways to stay healthy are also the least expensive—like taking a walk every day.
Use debt wisely. Many people push to pay off debt by retirement, which is fine, but higher net worth families may benefit from maintaining the right kind of debt, such as a home mortgage or pledged asset line of credit. All debt is not bad.
For those already retired, a reverse mortgage may be the right use of debt. These types of mortgages got a bad reputation long ago, but since then the rules have changed. Reverse mortgage can be a great financial tool! Give them a fair chance. If you have equity in your home and need extra money, don't be afraid to look into a reverse mortgage.
And if you get too much of the wrong kind of debt, such as high credit card balances and overall debt payments that you cannot afford, talk to a credit counseling agency.