For some baby boomers, the rising cost of living and insufficient Social Security benefits are turning the dream of retirement into a major challenge. Despite years of hard work and careful planning, the reality is that Social Security alone often isn’t enough to cover all expenses.
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While Social Security was initially created as a safety net, retirees can also supplement these benefits in a number of ways. Here are 7 realistic things boomers can do right now if they’re finding that Social Security is not enough for their lifestyle.
1. Reassess Your Budget
Taking a fresh look at your monthly expenses is the first step towards financial stability. Identify areas where you can cut costs without severely impacting your quality of life. Categorize your spending into essential items like groceries and utilities, and non-essential items like dining out or subscription services. This will give you a clearer picture of where your money is going and where you might be able to make cuts.
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2. Downsize or Consider Alternative Housing
Housing is typically one of the largest expenses in retirement, so it’s worth considering whether your current living situation is sustainable. Downsizing to a smaller home or apartment can significantly reduce your mortgage or rent payments, as well as costs associated with maintenance and utilities.
Also, exploring community living options such as senior living communities or co-housing can provide both financial and social benefits.
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3. Generate Income Through Part-Time or Remote Work
Some boomers find that returning to the workforce, even part-time, can be both financially and mentally rewarding. There are numerous opportunities available that cater to retirees, such as consulting, freelance work or remote positions that offer flexible hours.
Explore job boards and websites dedicated to freelance or remote work, such as Upwork or FlexJobs. These platforms often feature positions that can be done from the comfort of your home, making it easier to balance work with other retirement activities.
4. Maximize Retirement Savings and Investments
Even in retirement, it’s possible to grow your savings and investments. Review your current investment portfolio and consider reallocating funds to maximize returns while minimizing risks. Working with a financial advisor can help you make informed decisions tailored to your specific situation.
Consider diversifying your investments to include bonds, dividend-paying stocks or real estate investment trusts (REITs), which can provide steady income streams.
5. Explore Government and Community Assistance Programs
There are several government and community assistance programs designed to support seniors. Programs like Medicaid, Supplemental Security Income (SSI), and the Low-Income Home Energy Assistance Program (LIHEAP) can provide much-needed relief. These programs can help with healthcare costs, utility bills, food expenses and more. Researching and taking advantage of these resources can greatly alleviate financial stress.
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6. Monetize Your Home with a Reverse Mortgage
A reverse mortgage allows homeowners aged 62 and older to convert part of their home equity into cash without selling their home. This option can provide a steady income stream or a lump sum payment, which can be particularly helpful if you’re struggling to cover expenses.
Before pursuing a reverse mortgage, it’s important to understand how it works and the potential implications. Keep in mind that while a reverse mortgage can provide financial relief, it also reduces the equity in your home and may affect your heirs’ inheritance. Weighing the pros and cons carefully is essential to making an informed decision.
7. Leverage Senior Discounts and Savings
Take advantage of the numerous discounts and savings available exclusively to seniors. Many retailers, restaurants and service providers offer reduced rates for those aged 55 and older. These discounts can add up over time, helping you stretch your budget further.
Start by researching which businesses in your area offer senior discounts, and keep a list handy for reference. Additionally, consider signing up for discount programs such as AARP, which provides members with access to a wide range of savings on travel, dining and more.
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This article originally appeared on GOBankingRates.com: 7 Things Boomers Can Do Right Now if Social Security Is Not Enough
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