5 Tips for Managing Expenses in Retirement

Retirement comes with a major shift in your everyday life. That change goes hand in hand with a shift in the way you budget and manage cash flow. There is also a change in how you save or rather not save. Many retirees don’t save any more, after all, you spent all of your working life saving to get to this point. Managing this change in finances can be worrying; it can feel like you’re spending without earning. But it doesn’t have to be if you keep in mind these money tips around budgeting and cash flow.

Set Goals

Think about how you want to spend your retirement, and set goals to keep you on track with your spending,  The short term goals should be attainable and keep you focused, to ensure you are achieving small milestones while working towards your larger, more long-term goals.

Pay yourself a “wage”

When you retire, you will most likely have the most amount of money at that point that you will ever have, so it’s important to ensure you make it last. Based on your life expectancy, work out how much you can spend each year to make your money last and break it down into a weekly or fortnightly wage. 

Create a Budget

Once you have set your goals and worked out how much you can allow yourself to spend, you need to become friends with budgeting. Use a budget system that you are confident with, whether it’s that handy notepad and pen near your favourite chair or software, as long as you use it and stick to it. 

By outlining your financial incomings and outgoings,  you really get a feel for your financial position, and how much you need to save for retirement time.  The AFSA ‘Retirement Standards’ is a helpful resource to let you know what to aim for in your budget, and shows a reasonable amount to spend. 

Check Your Bills

Every year, do an audit on your bills. Now we know this takes time but time is one thing you have in retirement and it may save you a lot of money. 

• Make sure that you are getting the best deal for your electricity and private health insurance.

• Check up on interest rates

• Review the types of insurances

• Are you able to pay off your mortgage?

• Are your savings in the right place for you or do you have investments that need to be reviewed?

Take advantage of entitlements

Seniors discounts are there for you! So carry with you a proof of age card and you’ll find you can save on a huge number of things.

In addition to the age pension, you may qualify for other payments, like carer’s allowance. It’s worth checking in with your adviser to find out.

Even if you don’t get the age pension, you may be eligible for other benefits, such as travel concessions, cheaper medicines and reduced council and water rates. The Commonwealth Seniors Health Card will also give you discounts on travel and some utilities.

If you would like to find out more about how you can get the most out of your retirement, don’t hesitate to contact us at Solace Wealth Management and we can discuss your personal circumstances and come up with a plan that suits your needs.

You can be confident in knowing that the strategy you end up choosing will be the most appropriate in your individual circumstances. Contact us at Kate@solacewealth.com.au or 0423 313 486.

Kate Trost

Senior Financial Adviser and Director of Solace Wealth Management (AR numbers 465078/1262350)

Authorised Representative of Avana Financial Solutions (AFSL 516325).