How to Survive Retirement

Create a budget that allows for recreational activities as well.

For many people, retirement is a wonderful time in their lives where relaxation is top priority and the reward for many years of hard work. Unfortunately some retirees feel overwhelmed by the burden of a limited income, especially when it comes after an unexpected early retirement due to company lay-offs. Whether or not you have planned for retirement, you will want to go over your expenses and budget to better understand how you will survive your retirement and maintain a comfortable lifestyle.

Instructions

1. Review your bills and expenses for the last 12 months to get an idea of where you are financially. This will allow you to understand how much you spent on certain things with a full-time job and how much you will need to cut back with your retirement funds.

2. Consider what you can cut back on or live without during your retirement. This may include eliminating premium cable channels, changing your cell phone service or trading in your vehicle for one with a lower monthly payment. Remember that there are things you may no longer have to pay as much for such as gas if you had previously commuted to work.

3. Create a budget based on your current or future expenses by adding up any income you will receive including retirement funds from your 401 K or IRA, an employment pension plan or other means of income. Calculate the amount you will spend on bills and expenses including rent or mortgage, car payments, medical bills, utilities, groceries and money for recreation.

4. Apply for social security when you become eligible to receive these benefits; when you have an idea of how much you will get each month, add it to your budget.

5. Request a senior discount when you are at the grocery store, restaurants, movie theaters and retailers; many places offer up to 10 percent discounts for seniors.

6. Consider supplementing your income by working a part-time job. By working just a few hours a week you will be able to expand your budget and live more comfortably.

7. Avoid making large purchases and paying for them with credit cards; pay cash for as many items as possible and avoid the high interest fees.

References

• Daily Finance: Surviving an Accidental Retirement; Sheryl Nance-Nash; January 2011
• IRS.Gov: How to Take Responsibility for Your Retirement