Stretching your money
Summary
Many older adults are on a fixed income after retirement. As the economy fluctuates and living costs change, the value of stretching a dollar becomes apparent. This article offers tips for caregivers to make sure the person they are caring for is making the most out of their budget and spending wisely.
Review the budget
Many older adults are on a fixed income after retirement. When you sit down with them, take stock of monthly income and expenses. Start by posting two columns—money that comes in every month, and money that goes out—and note the difference between the two. It helps to go in knowing what to expect. Take stock of any recurring monthly expenses higher than $10. They can add up quickly and have a major impact on budgeting.
Now is a good time, also, to set a savings goal: maybe start with reducing money spent by 10% each month at first, or have a dollar amount in mind to put away toward vacations, unexpected expenses, or paying down debt.
Start big
Beginning with the most expensive items or costs in the budget, see if you can shrink those down first. Maybe now is the time to lower interest rates on credit cards, home loans, or other financed expenses. For many people, health care coverage is one of the largest expenses in the budget. Shopping around during open enrollment periods can lead to a huge savings in medical costs.
Take advantage of benefits programs
The federal, state, and local governments offer a wide variety of benefits for older adults. In addition to the more well-known programs like Medicaid and Social Security, seniors can save a great deal of money from benefits programs, including but not limited to the ones listed here.
- National Parks and State Parks passes
- SHIP Medicare counseling
- SNAP, community food programs, and food banks dedicated to older adults and those on fixed incomes
- LIHEAP energy assistance
- Broadband internet assistance
- Community transportation programs
- Home health care aids, long term care ombudsman service, and other health care benefits
- Tax help and tax consulting services
- Legal aid
Ask about discounts
Many, many places and service providers offer discounts and even free goods and services for veterans and senior citizens. It may not seem like much, but saving up to 15% or more can really add up. Look into the advantages of memberships like AARP, and remind the person receiving care that asking for a senior discount is a smart money move that can reap significant rewards. Look into Senior Discount Days at places like grocery stores, where older shoppers can get automatic discounts or free items on certain days of the week.
Join member reward programs
Grocery stores and big box stores like Costco, Sam’s Club, and BJ’s offer massive savings for bulk purchases. Especially on household and medical items that don’t expire, these savings add up. Another benefit that isn’t always considered is the discount on big-ticket items at these box stores. A new mattress, computer, or set of tires might be significantly less expensive for Costco members than someone shopping at a mall.
Movie theaters and entertainment venues, too, have incentive rewards for customers. And, coffee shops reward loyalty with free items for frequent buyers.
Bundle up and monitor subscriptions
As more and more media become subscription-based, the monthly cost for these subscriptions can add up. Many channels offer bulk rates for subscribing to multiple channels, like Hulu and Disney Plus. Keep an eye out for recurring costs that are no longer useful. If a person signed up for a service that they no longer use, or have forgotten to cancel a recurring service or subscription, canceling those charges means instant savings.
Shop smartly for essentials
For people living alone, it can be tough to use fresh produce before it goes to waste. And single-entree portions are often disproportionately expensive. What follows are a few ways to make grocery shopping less painful.
- Buddy up. Sharing groceries with a friend or relative is a great way to save costs and add more variety to meals. Splitting a family size package of chicken breasts on special, for example, can cut the cost down several dollars per pound.
- Shop specials. Each week, review weekly specials at local grocery and discount stores to see if there are any discounts on regularly-purchased items. Stock up on nonperishables when they’re on sale.
- Plan trips. The night before shopping, do some menu planning to decide what to buy. Consider how items can be used for several meals without any waste, and think about repurposing leftovers.
- Shop weekly. By limiting trips to once a week, making and sticking to lists, and planning trips based on specials and discounts, people can avoid impulse purchases and stick to the budget.
Sign up for savings alerts on big ticket items
Several websites offer email alerts for airfare, travel, and other large purchases. If a person is planning a trip, they can sign up for alerts from Google or from sites like Travelocity or Kayak that will automatically inform them when prices drop. Services like Visualping and Amazon Assistant monitor websites and send an email alert when prices drop or a sale occurs on selected items.
Lower energy costs
Many energy providers offer free at-home consultations to help customers save money on utility bills. A representative from the company will walk through the home and find spots with poor insulation, inadequate circulation, or other areas where heat or cold are escaping the home. Some utility companies also offer kits to save money on bills; these kits include energy-efficient lightbulbs, power-saving power strips, and other items to cut down on wasted energy.
Even without a consultation, the following steps can add up to big savings on monthly utility bills.
- Install energy-efficient light bulbs.
- Turn the refrigerator down. Keeping fridge temperatures between 37 and 40 degrees fahrenheit is enough to keep food safe.
- Look for drafts and insulate or close them.
- Clean air filters and ducts regularly.
- Install a programmable filter.
- Sign up for monthly budgeted costs. High heating costs in winter and cooling costs in summer can be startling. Most energy providers allow customers to pay an amount monthly that is the average of costs over the year. This makes budgeting simpler and removes the guesswork.
Related information
Dealing with financial challenges
Getting financial assistance
Getting out of debt
External supporting content
Money Matters: Top 10 Budgeting Tips for Older Adults
