Retirement is meant to be a time to relax and enjoy the fruits of your labour after a lifetime of hard work, but it’s also important to remain on top of expenses during this time to secure your financial future.

With the cost of living increasing and longer life expectancies becoming common place, it becomes increasingly important for over 60s to be aware of major expenses and where savings can be found day to day in order to enjoy a comfortable retirement.

By carefully evaluating spending habits and making small adjustments, it is possible to stretch a fixed income and make the most of retirement funds.

How to financially plan for retirement

According to the Association of Superannuation Funds of Australia (ASFA), the cost of a comfortable retirement for senior Australians has risen by 1.9 per cent, those over 65 now need to spend $68,014 per year for couples, and $48,266 for singles in retirement.

This figure alone should give retirees a rough idea of what they can expect to spend in retirement and where to channel funds to ensure the necessities are taken care of and peace of mind in your golden years is achieved.

When it comes to funding a comfortable retirement, founder and CEO of Stockspot, Chris Brycki also points out that “retirees should consider several factors when entering retirement” and the expenses associated.

• Income: Consider your income sources, such as pension, investments and government benefits and if they provide enough to cover your living expenses.
• Living expenses: Consider your living expenses, including housing, healthcare, travel and leisure activities, and if you will be able to afford them in retirement.
• Health: Consider your current and future health and the potential costs associated with healthcare and long-term care.
• Lifestyle: What’s your desired lifestyle in retirement, including hobbies, and other leisure activities, and whether their income will support it.
• Age pension: Consider the Age pension and other government benefits your are eligible for and how they will affect your retirement income.
• Debts: Consider any outstanding debts you have, such as mortgages or credit card balances, and how you will be able to pay them off in retirement.
• Inflation: Consider inflation and how it could affect the cost of living in the future and the purchasing power of your savings and retirement income.
• Estate planning: Consider your estate planning, including inheritance, tax and other issues that may affect the distribution of your assets.

Where retirees can save money and cut costs

As a retiree, it’s important to make the most of your savings and stretch your budget as far as possible.

By being mindful of expenses and finding creative ways to cut costs, you can enjoy a comfortable and fulfilling retirement.

In addition to the numerous discounts that are available to over 60s on things such as healthcare with the Commonwealth Seniors Health Card, retirees can shop around with energy providers to find the best deal and even find savings at the supermarket checkout by shopping smart.

Brycki advises that “retirees can look to a variety of places to save money and ease cost of living pressures.”

“This can be in paying for utilities, groceries and healthcare,” Brycki said.

Some of the other crucial areas that retirees can find much needed savings include:

• Government – Most governments provide seniors with discounts and reduced prices for items such as transport.

“Take a look at what your state/territory government provides. In NSW, permanent residents aged 60 and over can apply for either a NSW Seniors Card or Senior Savers Card,” Brycki says.

“This entitles the user to free items, discounts and access to special offers across government and non-government services.

“As an example, McDonald’s provides card holders with a free food item. The type of discounts differ from state to state and business to business.”

• Groceries – Brycki suggests that “where possible, bulk buy things when they go on sale, especially non-perishable items like cleaning products. Also look for special savings days.”
• Utilities – some utility providers offer a discount to seniors and retirees. Shop around to find a provider that offers discounts and to ensure you are getting the best prices.
• Healthcare – again shop around to ensure you have the best health cover available. Some providers give discounts to seniors provided they have a Seniors Card or are retired.

Brycki advises that “the first place to look is at non-essential items”.

“You want to be able to balance still enjoying life with your ability to finance your lifestyle,” Brycki says.

“Do you have a second or third car that you no longer need? Can you take public transport instead of the car? Retirees are usually offered discounts on public transport travel costs.

“A holiday home that you rarely used? Or do you have a home that is larger than what you currently need, especially if you no longer have children at home.

“Other ways to cut back could include eating out less or choosing restaurants that offer cheaper meals.”

How to save money on a fixed income

Despite the best of intentions when it comes to cutting expenses, as the cost of living continues to rise many retirees are finding they don’t have enough saved to cover their expenses and there are those that are being forced to find ways to make their money stretch further in retirement.

This is becoming an increasingly common problem, and it is one that is affecting retirees of all ages and income levels.

For those facing such a prospect, there are a number of strategies that can be utilised to put adequate money aside for a rainy day.

Brycki suggests the following options:

• Look for high-interest savings or term deposits to make your money work harder for you.
• Sell unwanted or no longer needed items including furniture and clothing. Gumtree and Facebook Marketplace are great places to do this.
• Look for super funds that are charging less than 1%. If you are paying more than 1% to your super provider, it’s likely you can find a better deal elsewhere.

On a final note, Brycki advises that for retirees on a fixed income, “it’s never too late to start a budget and start saving.”

Through effective budgeting, maximising retirement savings, reducing unnecessary expenses and shopping for the best deals around, you can take control of your finances and live a fulfilling retirement.