Retirement is supposed to be the reward. But according to a recent report by Vanguard, only 40% of baby boomers aged 61 to 65 are on track to get there financially. Many who have already retired are finding it harder than expected to make ends meet.
So what are boomers doing about it? Financial experts say a new wave of practical, no-nonsense habits is helping retirees protect what they have. Here are three that are making a real difference.
Buying Used and Refurbished Instead of New
More boomers are choosing used or refurbished electronics, appliances, and furniture, and they are not embarrassed about it. Financial advisor Paul Gillooly of Dot Dot Loans says the attitude around this is shifting.
“This is being seen less as ‘making do’ and more as a financially savvy decision,” Gillooly said. “There are quality products available that substantively reduce spending over many, many purchases.”
His one caution: make sure you check the warranty and consider whether the item will save you money on energy costs over time.
Using Free Apps to Track Every Dollar
Gone are the days of writing expenses in a notebook. Kevin Marshall, a CPA at Amortization Calculator, says boomers are downloading free budgeting apps, connecting them to their bank accounts, and uploading receipts to see exactly where their money is going.
This kind of real-time visibility makes it much easier to spot spending that is quietly draining your account.
Hunting Down Hidden Monthly Costs
This one might be the biggest opportunity of all. Alex Langan, chief investment officer at Langan Financial Group LLC, says most people have no idea what they are actually spending on subscriptions each month.
“Research puts the real number at more than double what people estimate, and a significant chunk of that is for services people forgot they’re even paying for,” Langan said.
He says the same is true for insurance policies that have not been reviewed in years, investment fees that are quietly high, and Medicare supplement plans that no longer fit your situation. Finding and cutting these costs, he says, can free up real money every month, without changing how you actually live.
None of these habits requires a dramatic lifestyle change. They just require paying a little more attention to where the money goes, and being willing to do things a bit differently than you did during your working years.