Have not you saved sufficient for retirement? Listed below are 7 issues you are able to do.
OK, so you’re one of the many who fails to save $ 1 million, or five times your annual salary, or whatever the current amount, designed to provide you with a comfortable lifestyle when you quit work.
Besides covenant, what should you do about it? Instead of going down the unrealistic path of saving a mountain of money at the last minute, try bringing the mountain to you: adjust your expectations for your retirement when you have to spend less than you thought necessary. It’s not all bad.
Here are some ideas for living on less in retirement:
1. Move to Expatria, the biggest country you’ve never heard of.
Expatria, as the “nation” of expats is called, is thriving, thanks in part to US retirees who are looking for places to live cheaper and who are still in the mood for adventure. There are many parts of the world where the cost of living is lower than the US and where retired US citizens are welcome. As a rule, other countries are very happy that you came and spent your money there – just not to come and work and take jobs away from their own citizens. They’re also less interested in paying for your health care, even if they have a universal plan. Yes Canada, we are talking about you.
According to the Social Security Administration, which issues them monthly checks around the world, there are currently around 500,000 American retirees living abroad. A heads up if you want to join their ranks: check the rules of the country you plan to settle in to see what the local tax liabilities are on your income – including social security.
While Social Security has you covered all over the world (with a few exceptions), Medicare benefits come to a halt at the US border. This means that as a retiree living overseas, you will either have to re-enter the US to get Medicare medical care or pay for the care yourself.
One of the most popular places for retired Americans is Costa Rica with a thriving expat community of more than 20,000 US citizens. According to SmartAsset, a retiree can live there for around $ 1,300 to $ 1,600 a month. Oh, and it’s beautiful, and they have universal health care for citizens and permanent residents.
The Live and Invest Overseas publication chose the Algarve, Portugal as the best place to retire overseas in 2017 based on a combination of natural beauty, weather and affordable housing. The publication estimates that a retired American couple could comfortably live there for about $ 2,160 a month, including pool maintenance.
International Living is a great place to start an investigation into what it’s like to live in Expatria. (For starters, you’ll likely have plenty of company: InterNations estimates 20 percent of all US expats are retirees.) AARP also has a list of the best places to retire abroad.
2. Work part time.
Social security, which was incorporated into law in 1935, was intended to provide a financial safety net for lower-income workers in retirement. It helps when we all think about it because it is not – and never was – intended to meet a person’s full pension needs. Still, the SSA estimates that 21 percent of couples and 43 percent of single seniors count on social security for 90 percent or more of their total income. Other sources of income are all the annuities you can collect – and less and less – and income from what you have saved.
However, you won’t be alone if you consider taking on a part-time job in retirement.
As a rule of thumb for retirement savings, you must have saved $ 240,000 for every $ 1,000 you estimate to need each month of retirement. So if you haven’t saved that much, an alternative is to replace that income with a part-time job. Remember, $ 1,000 a month is roughly just $ 250 a week. Hell, some teenagers babysit so much in the summer. (The current babysitting rate is around $ 15 per hour. Here’s a calculator that can help you see what your zip code can make for you.)
3. Consider sharing the house.
While health care pay can be a boogeyman for retirees, housing costs shouldn’t be dismissed as a stroll in the park. You are very much a budget cripple.
But do you remember what the Golden Girls did? Sharing a house with like-minded friends not only reduces housing costs, but also offers an integrated support network.
Or if you love your friends but don’t want to live with them, rent out an unused bedroom to someone and enjoy the extra monthly income. Think broadly: can you turn the garage into a studio apartment and earn a monthly income from it? How about moving into a grandma’s hut in the yard and renting out your house for even more money?
You can also use your home to cut down on your expenses. Consider swapping some space for live-in help. Give up an unused bedroom for someone to do some light cleaning, cut the grass, and drive you where you have to pay for those services.
4. Unload your car.
If you eliminate your commute to work, there’s a good chance you’ll eliminate one of the top reasons you even had a car. You will certainly drive less. Find out what it costs to own and operate a car for a year – purchase or lease price, insurance, gasoline, oil changes, tires, repairs, and parking – and divide that by 12.
Owning and operating a private vehicle in 2017 cost an average of $ 8,469 per year, or $ 706 per month, according to the AAA. Depending on where you live, it may cost less to call an Uber or use public transit to get around. You can always rent a car if you need it.
Also, your heart will thank you for walking or getting around by bike.
5. Embrace the sharing economy.
Swap your homes with someone who lives where you want to vacation. Form a neighborhood cooperative for Costco memberships and buy in bulk. When you travel, stay in Airbnbs, which are usually cheaper and often have small kitchens to cook your breakfast in to save even more money.
Sign up as a home or pet sitter with a service like Trusted House Sitters. For $ 119 a year, this service finds and reviews pet sitters who want to take a vacation by staying with someone else’s home. You can become a pet sitter yourself or use one to save money on a pet sitter when you are away.
6. Rethink travel.
The nice thing about not being tied to a work schedule is that you can move around freely in the cabin, so to speak. Travel becomes much cheaper if you don’t have peak travel times associated with it. Travel out of season and fly during the week when the price is lower. Spend weekends in hotels for business customers on weekdays.
You can also stay longer and live more like a native than a tourist. Remember to rent out an entire apartment or house and use it as a base. Access to a kitchen means fewer meals.
7. Reduce and suppress.
There is really gold in “the hills” – and probably in your attic, basement, and storage unit that you pay for every month.
Retirement is a good time to put aside the excess things that you have accumulated. And you might as well shed it for money. Here is a starter list of places to sell things online. And don’t forget the tried and tested junk unloader: the humble flea market.