Yahoo Finance 7 Expenses That Are Easiest To Cut While on Social Security
For retirees who are living solely or largely on their Social Security income, budgeting is essential to make ends meet. While inflation may have cooled some, the costs of living are still higher than they used to be. Those on limited incomes feel that pinch the most.
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However, sometimes it’s difficult to figure out what expenses can go or can be replaced with cheaper alternatives. Financial experts suggest the easiest places to trim your budget without feeling deprived.
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Nonessential Expenses
The first place to look to cut costs, of course, is nonessentials, such as entertainment costs, according to Alec Kellzi, a CPA at IRS Extension.
Christian Strange, owner of Strange Insurance Agency, works frequently with seniors and recommended looking at your landline phone and cable TV bills, as these services are typically overpriced.
“Most seniors can switch to budget cell plans, streaming services or free local TV for big savings. I’ve seen clients cut $100 to $200/month this way,” Strange said.
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Brand-Name Food
Food costs are often too high for fixed incomes, according to Strange. An alternative is buying generic or in-season foods only. These and other strategies, such as using coupons and meal planning, can reduce grocery bills 30% to 50%.
“For example, one client saved $200/month just by switching from name-brand to store-brand goods,” he said.
Dining Out
Similarly, a fixed income doesn’t lend itself well to dining out, which comes with very steep costs, Kellzi pointed out.
“Focus on home cooking, use grocery store loyalty programs and check out senior meal programs. Consider community gardens or food banks for additional savings on nutritious foods,” he said.
Utility Bills
While you have to pay for your essential utilities, there are often senior discounts from utility companies and free energy audit programs, according to Kellzi. “Small changes can lead to noticeable reductions in monthly bills,” he said.
Insurance Costs
Again, while you need to have some life insurance, Kellzi said, you might be paying too much for the wrong kind. He recommended you review all insurance policies annually.
There are also other avenues you can explore to save. “Look for senior discounts, bundle policies for savings and consider increasing deductibles if it significantly lowers premiums. For life insurance, evaluate whether maintaining a policy is still necessary,” he said.
Medicare Plan Costs
While no senior should skimp on healthcare, Strange said that Medicare plans should be reevaluated yearly. “Many pay too much for premiums and prescriptions. Switching to Advantage plans and generic meds saved one couple $500/month. Assistance programs can also lower [medication] costs,” he said.
Vehicle Costs
If you live in an area with solid public transit, ride-sharing or senior transport services, you might be able to get rid of your car altogether or sell a second car, Strange said.
Not only would you save on gas, but you could use the extra funds from selling a car to pad an emergency fund or invest in a retirement account. “Selling an extra vehicle saved a client $6,000/year in costs,” Strange said.
He pointed out that with the right changes, most seniors he works with can trim $500 to $1,000 per month in essential bills.
“Small shifts add up, so rechecking options annually and making incremental changes is key,” he said.
Also: Seek Out Senior Discounts
Always remember to seek out senior discounts on every service or product you purchase before paying for anything. There are also local and federal programs for hardship in areas like housing costs, utilities costs, grocery costs and more.
Cutting expenses doesn’t have to hurt so long as you know where to look.
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