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Nov
7

Retirees: 5 Questions to Ask Yourself Before You Let Loose

Tags: retirement, senior discounts, medicare

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Retirees: 5 Questions to Ask Yourself Before You Let Loose

 

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Retirees: 5 Questions to Ask Yourself Before You Let Loose

Baby Boomers, listen up! You’ve worked hard your entire life. Now that you’ve retired, it’s time to relax and live a little. While packing away money for a rainy day is certainly important, there’s nothing wrong with loosening the purse strings now and again. It’s a hard notion to grasp, though it’s one you should consider. But before you give yourself a major indulgence, take a moment to make sure your budget can handle it.

Here are five questions to ask yourself to help you decide what to do with your cash stash.

1. Can I afford my mortgage?

If you’re like the majority of older Americans, you don’t have a mortgage payment. The AARP estimates that only 40 percent of the boomer generation still owes money on their home. But if you’re one of these 40 percent, do some math. If your mortgage is $1,000, how much do you have left over and how much do you spend on other necessities? If you’ve got some cash in the bank, these leftover funds could be put to good use letting you enjoy your retirement. Due.com offers several great tips on how to pay down your mortgage -- start now and you’ll have a disposable income in less than a decade.

2. Is my healthcare plan right for me?

When you hit 65, you get to apply for Medicare. And that’s great since it’s usually less expensive than private health insurance and offers a host of benefits for us older folks. But the Medicare plan you have now may not be the best one. Talk to a Medicare specialist to see what options are available. The Annual Election Period (AEP) starts on October 15th and runs through December 7th every year. Once you have your healthcare covered, you can look at other ways to spend wisely.

 3. Do I really need life insurance?

The short answer here is probably no. By the time you retire, your children should be grown and won’t need to rely on you for an income. Ideally, you’ve also saved enough to pay for your final expenses and to support your spouse, if needed. Neptune Society asserts that life insurance is just an added expense that may not be worthwhile at this stage of your life. By dropping unnecessary life insurance, you could save $230 or more each month. That’s enough money in one year to pay for multiple cruises or to buy that vintage muscle car you’ve always wanted to restore. 

4.  Am I taking advantage of all the discounts available?

If you’re not seeing at least a few dollars off your bill when you dine out, travel, or shop, you aren’t doing it right. If you’re over 65, you’ve earned the right (in most retailer’s eyes) to enjoy discounts. Money lists the top 10 discounts for seniors that can help you afford more out of your retirement years. Possibly the best discount mentioned is for wireless service. Seniors may be eligible for unlimited talk, text, and mobile internet for $35/month, about half of what the younger crowd will pay.

 5. Will my loved ones want stuff or memories?

It’s understandable to want to spoil your family at Christmas and birthdays, but maybe that’s not the best way to spend your money. As hard as it is to think about, you’re at an age where your family will have to learn to live without you sooner than they’d care to. Instead of expensive gifts, turn their presents into experiences. Take the grandkids on a weekend getaway, enjoy an art class together, plant a fairy garden...whatever you do, the memories you share will last longer than something stamped “Made in China.”

To be clear, you have to make sure your obligations are met but you should make your enjoyment one of these priorities. By shifting your spending, you can remain financially responsible while living life to the fullest, and isn’t that the point?

Author: Jim McKinley

Moneywithjim.org | jmckinley@moneywithjim.org

 

   

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