If you’re nearing retirement, or are already there, you’re likely on a fixed budget.  Unless you planned well and saved plenty for your golden years, you may be running short on funds each month.  If that’s the case, it’s important to save where you can to help ensure you don’t outlive your nest egg.

A recent AARP article likens saving money to losing weight.  Unfortunately, there are no short cuts.  To successfully lose weight you have to take in fewer calories, exercise more or both.  The concept of saving money is very similar.  The only way to save money is to spend less, make more or do both in tandem.

According to the article, below are several ways you can easily save a little extra cash.


“Research reveals that we get used to living on a certain budget if that is all we have.”  However, if we come into additional funds, as you would with a pay increase, we tend to spend those funds.  Rather than spending that extra cash, you can set up an automatic monthly transfer to your savings/investment account or use the extra money to pay down debt.  It helps to think of the monthly transfer as an obligation you can’t turn off.  It doesn’t take long to adjust to living within the new budget.

Pay yourself most of your raise

Getting a raise is great, but we tend to get used to spending that new money pretty quickly.  As an alternative, consider putting a portion of the extra funds into savings or towards your 401(k).  For example, if you get $100 monthly pay increase, save at least 70% of it for later and enjoy the rest now.  If you follow this strategy with all your raises over many years, you’ll end up saving a bundle.

Reframe how you think about big purchases

Sure, it’s nice to get a new car or have the latest technology.  However, you have to ask yourself if the long term cost of large purchases like these is really worth the benefit you receive.  For example, with a new car, how much longer will you have to work to cover the extra costs?  If you buy a new car every few years, how many years might this push back your retirement date?  How will you feel when the car gets its first dent?

Use cash

It’s easy to spend money using a credit card, so next time consider using cash instead.  Handing over cold hard cash for a purchase helps us realize how much we’re actually spending.  Plus, having to run back to the ATM more often tends to make us want to take out less.

Reward yourself

Finally, it’s important to reward yourself if you meet your savings goal.  Granted, spending money to reward yourself will reduce your actual savings, but only by a small amount.  Besides, you worked hard to achieve your goal so you deserve it!

If you follow these tips, but find that it’s still not enough, you may want to consider a reverse mortgage.  A Home Equity Conversion Mortgage (HECM), commonly known as a reverse mortgage, is a Federal Housing Administration insured loan.  A HECM enables seniors age 62 and older to access a portion of their home’s equity to obtain tax free2 funds without having to make monthly mortgage payments.3

If you’d like to learn more about HECM reverse mortgages, please use our Reverse Mortgage Calculator or call 800-218-1415.


1 7 Ways to Save More – aarp.org, by Allan Roth, 5/5/16, http://www.aarp.org/money/budgeting-saving/info-2016/ways-to-save-more-photo.html#slide1.

2 Consult your financial advisor and appropriate government agencies for any effect on taxes or government benefits.

3 You must live in the home as your primary residence, continue to pay required property taxes, homeowners insurance and maintain the home according to Federal Housing Administration requirements.

Author:  Meredith Manz