8 Myths About Retiring on a Budget

Planning for retirement can be stressful no matter how much money you've saved. Retirement is the first time in most people's lives when they no longer work full-time, and not having a regular income can be frightening or overwhelming. In addition, many people approach the retirement age without having saved as much as they'd have liked over the years. That's why knowing how to retire on a budget is so important. That said, there are several myths and misconceptions about the ability to be frugal in retirement. We've examined many of these myths so we can show you the truth about retiring on a budget. Read on to learn more about how to conserve your savings while getting the most from your golden years.

8 Active Myths | Suggest a Myth
MYTH: You should always stay put.

Your monthly rent or mortgage will almost always be your single-biggest monthly bill. If you can downsize your home to something smaller, then you can instantly start saving. Many seniors still live in the homes where they raised their families, and they could get by with significantly less space in their golden years.

MYTH: Small debts matter less than large debts.

Do you still have debts to your name? If so, you can instantly free up disposable income by paying off any smaller debts that sap your fixed income. Credit experts recommend paying off smaller debts before paying more against large debts.

MYTH: You can't count on saving from coupons each month.

There's no reason why you can't make coupons and discounts part of your regular spending habits. Seniors who use coupons can get discounts on groceries, free meals and much more. Anything that saves money can help.

MYTH: Get your Social Security payments as soon as possible.

Wait as long as you can before you start drawing your social security checks. That said, some people need these payments to cope with unexpected or emergency expenses. Talking to a financial planner can provide you with important insights about when to start taking your payments.

MYTH: Getting health coverage when you're old is easy.

Getting some kind of coverage when you're older is usually a given, but what kind of coverage do you want? You'll need to choose between traditional Medicare, a Medicare Advantage plan, a Medigap plan or a private insurance plan. Each plan offers different benefits, and you'll want to take this seriously especially if you face greater risks of health problems.

MYTH: Most seniors don't need to see a financial planner.

Seeing a financial planner is a good move for anyone who plans on retiring. Financial experts can provide sage advice to seniors about how to manage debts, whether to downsize their homes, what to do about health expenses and other important topics. Financial planners can also provide insights about handling investments, creating advance directives and more. This is something all seniors should do at least once.

MYTH: Keeping your car makes you more independent.

You don't need a car to be independent; you especially don't need a car payment or auto maintenance bills. This is especially true if you live in an area with a great public transit system. Even if you have mobility issues, some cities provide pick-up transit services to help seniors run their errands and get to doctor appointments. Seniors can also save money by sharing a vehicle with a friend or family member.

MYTH: The AARP doesn't offer many discounts.

Joining the AARP is one of the best ways to save money during your retirement years. Seniors who sign up get discounts on travel, entertainment, tires, prescriptions and more. Definitely sign up with the AARP if you haven't already.