Whether you’re nearing retirement or you’ve already left the workforce, you’re probably looking for ways to make your Social Security and other sources of retirement income stretch. You may also want to free up money so you can add to your retirement savings.
With current skyrocketing prices on gas, groceries, dining out, travel and many other expenses, you may even worry about outliving your retirement savings.
Fortunately, there are plenty of ways to cut back on monthly costs so you can spend less of your savings and still have enough to live comfortably while you kick back and enjoy retirement.
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1. Get rid of that second car
If you and your spouse or partner own two cars, you may find that you can both still get around just fine with only one vehicle. The average total annual cost of owning a new car is nearly $10,000 ($9,282), according to AAA. Sell one vehicle, and that’s a savings of more than $700 a month.
Even if your vehicle is paid off, you’ll still have auto insurance, gas costs and regular maintenance costs such as repairs, new tires and licensing.
Find out: How to Save for Retirement Even if You’re in Debt
2. Downsize to a smaller home
You may love your spacious home and all the memories that live on within it. At the same time, however, you may be feeling the pinch of all those big expenses that also come with owning a large house.
Consider downsizing to a smaller home or condo with lower utility costs, lower home insurance premiums and smaller appliances such as furnace, air conditioner, hot water heater and other that cost less to replace and maintain.
Find out: 6 Ways Downsizing Can Stretch Retirement Income
3. Relocate to a lower cost of living
If you live in a city with a high cost of living, consider moving to a city or town where it costs less to live. Perform an online search for “best places to retire,” “cheap places to retire” or a similar search term. You’ll get pages of articles about cities with lower-than-average costs for housing, groceries and other everyday or monthly expenses.
To get a general idea of the cost of living for a specific area, look up cities you’re considering on Sperling’s Best Places, Numbeo or a similar site. For a cost-of-living breakdown, input the city into the Sperling’s Best Places 2022 Cost of Living Calculator. The results will tell you how far your current retirement income may go in a new city or town.
Find out: 8 Questions to Ask Before Relocating in Retirement
4. Pay off your mortgage
Paying your mortgage off before you retire or shortly thereafter will cut out one of your largest monthly expenses. However, paying off your house may not always be the best choice. For example, you may earn more by investing that money. Check with your financial advisor on whether paying off your mortgage early is a good financial move.
Find out: What are the Pros and Cons of Paying Off a Mortgage Early?
5. Consolidate errands to save gas
Gas prices are expected to increase significantly due in part to the crisis in Ukraine. As of March 10, 2022, the national average at the gas pump was $4.32 per gallon, according to AAA. Gas prices are already over $5 a gallon in some cities and are expected to climb.
To save on gas, write down errands to run and try to fit them all into one trip if possible. You may be surprised at how much longer you can go between fill-ups with this one small change.
Find out: 8 Ways to Save Money at the Gas Pump
6. Take a part-time job that offers discounts
Many retirees like to work at a part-time job for extra income. So, why not get a job that comes with perks or discounts on something you love?
For example, working part-time at a golf club might allow you to play for free and receive discounts on equipment and merchandise. Working a couple of days in a retail store can allow you to buy clothes and other items at deeply discounted prices.
