Additional Coverage:
- Retirees Should Cut These 8 Expenses To Save up to $25K a Year (financebuzz.com)
Retiring on a Budget? Here’s How to Save Up to $25,000 This Year!
You’ve worked hard your whole life, built up your nest egg, and now it’s time to enjoy retirement. But if you’re finding your budget a bit tighter than expected, don’t fret!
Some smart adjustments can help you stretch those savings further, potentially putting an extra $25,000 back in your pocket by year-end. Let’s dive into some key areas where you can trim expenses and boost your retirement fund for 2026.
1. Ditch the Extra Wheels: Gas and Car Insurance
Approximate Yearly Savings: $8,600
Now that the daily commute is a distant memory, do you really need multiple cars? If your household has more than one vehicle, consider downsizing to just one.
The numbers speak for themselves: the average American spent over $2,400 on gas and nearly $2,000 on car insurance in 2024. Add in an average of $4,200 for maintenance and other vehicle expenses, and you’re looking at a whopping $8,600 in potential savings annually by eliminating a car.
Plus, selling it could give your budget an immediate boost!
2. Skip the Shiny New Ride: New Car Purchases
Approximate Yearly Savings: $5,300
Thinking of trading in your reliable older cars for one brand-new model? Hold that thought!
Even those who trade in vehicles still spent an average of $5,337 per household on new car purchases in 2024. Your retirement savings will thank you if you stick with your trusty older vehicle instead of succumbing to the allure of the latest model.
3. Home Cooking for the Win: Eating Out
Approximate Yearly Savings: $3,900
Dining out frequently adds up fast. Beyond the food itself, you’re paying for tips, gas to and from the restaurant, and even pricier service fees if you’re ordering in. You don’t have to become a complete hermit, but scaling back from several restaurant meals a week to just once a month can lead to significant savings.
4. Smart Travels: Vacationing
Approximate Yearly Savings: $4,000
While retirement often sparks dreams of travel, it can be a major drain on your finances. A single week-long vacation can cost an individual nearly $2,000 when you factor in food, travel, transportation, and activities.
Cutting two weeks of vacation, or even just one for a couple, could free up $4,000. If wanderlust still calls, consider budget-friendly alternatives like driving to a nearby national park and camping instead of flying cross-country.
5. Tackle That Debt: Credit Card Interest and Fees
Approximate Yearly Savings: $100 (and much more long-term)
Paying off credit card debt might feel like a big hurdle, but the long-term savings on interest payments are immense. While your immediate yearly savings might only be around $100, consider this: making only minimum payments on an average credit card debt of $11,413 can result in a staggering $18,500 in total interest charges over time. Eliminating that debt frees up significant funds.
6. Streamline Your Screens: Streaming Subscriptions
Approximate Yearly Savings: $900
Do you really need every streaming service under the sun? Many shows and movies eventually make their way to your local library, where you can access them for free. Cutting back on those monthly fees can quickly add up to substantial savings.
7. Family Plan Freedom: Family Phone Plans
Approximate Yearly Savings: $1,880
If your adult children or grandchildren are still on your family phone plan, it might be time for them to get their own. A typical four-person family plan can cost around $200 per month, or $2,400 annually. Downsizing to a one- or two-person plan with a more affordable carrier, and holding onto your current phone instead of upgrading immediately, can significantly reduce this expense.
8. Downsize Your Digs: Housing Costs
Approximate Yearly Savings: $3,650
For those needing a more drastic financial shift, selling your house and moving into a smaller rental could be a game-changer. Homeowners typically spend over $9,000 a year on housing costs, compared to just over $5,660 for renters. While it’s a big decision with many factors to consider, if the kids have flown the coop and you’re now in a one or two-person household, downsizing could make solid financial sense.
The Bottom Line
Thinking about how to make your retirement savings last can be daunting, but a little strategic planning goes a long way. While cutting entire expense categories can drastically reduce your spending, don’t underestimate the power of trimming even small expenses. Every penny saved contributes to ensuring your savings comfortably support you throughout your golden years.
Read More About This Story:
- Retirees Should Cut These 8 Expenses To Save up to $25K a Year (financebuzz.com)