Yahoo Finance 6 Summer Expenses Boomers Should Cut Now If They Plan On Retiring This Fall
If you’re hoping to retire this fall, it’s time to get your finances in order. This summer is a perfect time to carefully review your spending and look for ways to save.
“It’s important to know that cutting costs is essential,” said Joe Boughan, certified financial planner (CFP) and owner of Parkmount Financial. “But if you are planning to retire, make sure you are investing in areas that can provide quality of life returns.”
For example, he said focusing on expenses that benefit your physical and mental health can be a good choice.
“Investing in a reasonably priced healthcare membership and using it is 100% worth it,” he said. “Additionally, investing in activities with family and friends to build relationships can have a tremendous impact on retirement satisfaction, as long as it’s not excessive.”
Overall, he said to just make sure you’re spending money mindfully on expenses that align with your needs. Here’s a look at six costs you may want to phase out this summer, to ensure a smooth financial transition to retirement.
Overly Expensive Lodging
“Plan your vacation but take a moment to compare amenities and prices on Airbnb versus hotels and other options,” Boughan said. “Don’t go too cheap, but you may find the experience is just as good without breaking the bank.”
This might require a little more planning time on your part, but it could result in serious savings.
“I’ve seen clients spend $5,000 to $6,000 for a single-person week trip using a travel agent,” he said, “when a little research and planning could significantly reduce that cost without sacrificing much quality.”
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Paying for Your Adult Children’s Bills
If you’ve been helping your adult children out financially, it’s time to stop.
“As you transition to retirement, you need to consider your costs and how they impact your ability to support yourself for years to come,” Boughan said. “It’s time for grown children to handle their own phone bills and help with rent, etc.”
Cable
It’s time to cut the cord.
“Get a high-definition antenna and subscribe only to the entertainment channels you need,” Boughan said. “Once you make the switch, you’ll forget you ever wanted cable.”
You might be pleasantly surprised at the level of customization you can enjoy with streaming services.
“If you need to watch a sporting event or something similar, there are many online services you can subscribe to and cancel as needed,” he said.
Luxury Car Payments
Cars are expensive and even more so for luxury models.
“If you lease a Mercedes, you should have enough cash in the bank to make those payments twice over,” Boughan said. “If your retirement planning is marginal, consider turning in the luxury vehicle and getting a used, but current, Toyota or Honda with all the same features for a fraction of the cost.”
Interest Expense
Holding high-interest debt is never a good idea and definitely not something you want to bring into retirement.
“Pay off outstanding credit cards and personal loans that are racking up interest,” said Noah Damsky, chartered financial analyst (CFA) and principal at Marina Wealth Advisors. “Mortgages, especially low interest rate mortgages, may actually be valuable, so keep those.”
Excessive Life Insurance
“Evaluate your life insurance needs to see if you still need some of those policies you’ve had for a while,” Damsky said. “Perhaps it makes sense to keep them, but given that you’re retired, they may no longer be necessary as an income replacement in the event of death.”
This can lower your premiums, freeing up cash to use elsewhere in retirement.
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This article originally appeared on GOBankingRates.com: 6 Summer Expenses Boomers Should Cut Now If They Plan On Retiring This Fall
