Beat the rising cost of living and still enjoy retirement

The recent price hikes have impacted everyone, but they’ve been extra tough on those trying to get by on a pension or retirement savings.

Here are five great tips to help take the pressure off if your budget is feeling stretched.

1. Shop around

Inflation is hitting everything, from the price of lettuce to the cost of electricity, but it doesn’t mean there aren’t some good bargains to be had by shopping around. You just need to take the time to look.

If your grocery bill has exploded, then think twice before you put any item in your trolley. Look for low-cost produce that’s in season, cheaper generic brands, or even change your shopping preference to a low-cost supermarket.

No matter what you’re buying, investigate the market online and compare prices, particularly for big-ticket items such as insurance or travel. Sometimes just making a few small changes to your insurance cover or when you plan to travel, will save you big dollars.

Better still, if you find a better price offered by a competing company, don’t hesitate to go back to your existing supplier and ask them to improve it. And always ask for a seniors discount. Seniors cards are not means tested and are available to anyone over age 60.

2. Boost your income

With the jobless rate at record lows, there are employment opportunities everywhere and companies are more open to taking on older staff these days, particularly for part-time roles, than they have ever been in the past.

Don’t wait to be asked. If you have a favourite neighbourhood café or gardening shop that you think you’d like to work in, stop by when they are quiet and have a chat. More than just earning some extra dollars, it’s a chance to get involved with your local community.

To help you along, the Federal Government has just increased the Work Bonus Scheme, or the amount you can earn without impacting on your pension entitlements, by $4,000 to $11,700 a year. This is an added reason to pick up that part-time job.

While this increase is temporary, more and more people are hoping it will become a permanent change and help more older Australians back into the workforce.

3. Develop a ‘side-hustle’

A side hustle is what the youngsters call your own part-time business. It just sounds more hip. This can be anything from picking up some lawn mowing rounds in your neighbourhood to writing local history and selling it at the next farmer’s market.

Only your imagination will limit what you might be able to do and the most important thing to remember about a side hustle is to find something you enjoy doing, and then try to make some money from it.

Retirement is the perfect time to do those things you’ve always wanted to do but never had the time to do. Let your passions go wild. Start out small. Perhaps start by offering a free service and then build it into a money-making opportunity.

4. Stop paying taxes

Many people go to great lengths to sort out their savings when they retire, but others just sort of slide into retirement without too much pre-planning other than applying for the age pension and dusting off their golf clubs.

The Federal Government recently abolished the Work Test, so as long as you’re under 75 years of age you can contribute up to $330,000 of after-tax money to super this financial year, where it can sit tax-free. If the only assets you hold beyond your home are in super, you may never need to lodge a tax return again.

Think about it. Any money you save in reducing your tax obligations, you can use to cover the higher cost of living and it’s all totally legal. Just find a good advisor and ask whether you can minimise your tax bill by putting funds into super.

5. Wait for better times

Don’t be overwhelmed by doom and gloom. It’s easy during periods of increasing interest rates and economic slowdowns to think things will never get better, but when we think about it, we all know that times will get easier.

So, in the meantime, have a picnic in a local park rather than going out for lunch. Swap houses with a friend interstate rather than travelling overseas. There are endless ways to save money. Times will improve and that’s when you can start stepping out again.

Patricia Howard is a qualified Australian financial adviser with her own licence, who specialises in providing advice to those in or near retirement. She is also the author of The No-Regrets Guide to Retirement: how to live well, invest wisely and make your money last (Wiley) and a former journalist for The Age newspaper.