Five Expenses To Reduce In Retirement

After leaving the workforce for good, one of the biggest worries facing retirees is outliving their nest egg. To ensure this doesn’t happen, there are certain expenses that people should plan on reducing once they have retired.

Expense No. 1 – Credit cards

Carrying credit card debt into retirement is one of the biggest mistake consumers make these days. Chances are people will have to adjust to living on a lower income after leaving their full-time jobs, and having to make credit card payments each month will take away money from other areas. For this reason, it would be wise for people to pay off all credit card debt before they retire, so they don’t have to worry about accruing interest putting a dent in their savings.

Expense No. 2 – Life insurance

The older people get, the fewer relatives there are that financially depend on them. That being said, life insurance policies aren’t as important as they once were. So, retirees can potentially save some money each month by eliminating or reducing their plans. However, this isn’t always a good idea, especially if a spouse would struggle financially if the policyholder passed away.

Excuse No. 3 – Phone

With most people having a cellphone, land lines are becoming obsolete, so retirees looking to cut down on their expenses would be smart to eliminate this service. Generally, home phone service is offered as a package with cable and Internet, so it will be important to make sure getting rid of a land line won’t cut the discount received by bundling. However, many providers have begun offering double-play packages, and making the switch could save people money.

Expense No. 4 – Transportation

After leaving a full-time job for good, people no longer have a need to commute to work every day. As soon as their spouse doesn’t do the same, it might be a good idea to get rid of one car. Transportation can be expensive even when retirees aren’t driving all the time, as they still need to pay for gas, general upkeep and car insurance.

Expense No. 5 – Food

While food is certainly a necessity, there are ways retirees can cut down on this expense. For example, reducing the number of times they eat out at restaurants would be wise, as it is generally much cheaper to dine at home.

Jessica Williams is Consolidated Credit’s Marketing Communications New Media Coordinator. As a member of the education team, Jessica focuses on helping consumers make better financial decisions while living debt-free. She has previously worked with Take Stock In Children, where she was a mentor and communications specialist, and SouthPromo.com, where she managed community relations, event planning, marketing, and public relations. Jessica attended both the University of Florida and the University of Central Florida where she received her B.S. in Interpersonal/Organizational Communications and Marketing. Connect with Jessica on Google+.