Are you getting close to retirement and have no savings but expect to get $1,900 a month from Social Security? You might be thinking if that much money is enough to live on.
Social Security payments were made to add to pensions and savings for retirement, not to replace a nest egg that doesn’t exist. But it’s important to think about whether or not it’s possible to depend only on the government’s safety net.
The Reality of Retirement Without Savings: How to Make Social Security Work for You
According to the U.S. Census Bureau’s Survey of Income and Program Participation (SIPP), a staggering 49% of adults aged 55 to 66 have no personal retirement savings. Breaking it down further:
- 46.8% of men in this age group have no retirement savings.
- 50.2% of women in this age group are also without retirement savings.
Also, the numbers show that for people 65 and older, 12% of men and 15% of women count on Social Security for 90% or more of their income.
Think about a situation where you are 65 years old and about to retire. With a $1,900 monthly Social Security check, it’s important to look at your spending and living needs.
- Housing Costs: Are you renting or do you own your home? Mortgage or rent payments will significantly affect your budget.
- Healthcare: Medical expenses can be substantial, especially as you age. Consider additional insurance or Medicare supplements.
- Food and Utilities: Basic living costs like groceries, electricity, and water should be factored in.
- Transportation: Whether you own a car or rely on public transportation, these costs can add up.
- Entertainment and Leisure: Don’t forget to account for hobbies, travel, and other activities that enhance your quality of life.
Some people can live on Social Security alone, but they usually have to be very careful with their money and maybe even make some changes to how they live. To make sure you have a comfortable retirement, you should look for other ways to make money or get financial help.
Are you getting close to retirement and don’t have any savings but expect to get $1,900 every month from Social Security? That’s a little more than the average of $1,800 that retired workers made in June 2024.
You may be thinking if it’s possible to live a good life on about $23,000 a year. The good news is that it is possible with some careful planning and changes. Here are five things that can help retirees who don’t have enough money saved.
Consider Downsizing Your Home
Whether you rent or own your property, one effective way to free up some money during your retirement years is to downsize your home.
Why Downsizing Makes Sense
If you no longer need as much space as you used to, downsizing can save you a lot of money on your monthly bills. This can help you a lot if you want to move out of your current city or state and into one where property taxes and insurance costs are lower.
Action Steps for Renters
For those who rent or plan to rent, consider researching cities and states with more affordable rates. Some regions offer lower living costs while still providing a good quality of life.
- Research affordable cities and states.
- Compare property taxes and insurance costs.
- Evaluate the cost of living in potential new locations.
You can get the most out of your Social Security income and have a better retirement if you follow these steps.
Looking for ways to live that won’t break the bank? Apartment Advisor says that the median rent in places like West Virginia, Kansas, and Arkansas is some of the lowest in the country. In these places, it costs about $725, $755, and $825 per month to rent a one-bedroom apartment. The national average rent is $1,536 per month, so this is a lot less than that.
Turn Your Home Equity into Retirement Cash
If you own a home and your mortgage is paid off, you might want to use the equity in your home to save more for retirement. It’s possible for downsizing to work. The 2022 American Community Survey from the U.S. Census Bureau shows that 33.3 million Americans do not have a mortgage. This is a great chance to use that equity to save for retirement.
Unlock Savings with Discounts and Freebies
For retirees, seeking out various discounts and freebies can make a significant difference in your budget. One valuable resource is the AARP. With a one-year membership costing just $16 ($12 for the first year with automatic renewal), you can access hundreds of potential benefits.
Everyday Savings
- Discounts at restaurants
- Gas savings
- Shopping discounts
Special Offers
- Discounted car insurance
- Reduced fees on prescription lenses
- Free tickets to live performances
You can get more out of your retirement money by using these tools. They can help you stay financially stable and give you new experiences.
Would you like to get the most out of your retirement? There are many programs and tactics that can help you save the most money and live a comfortable life, whether you’re already in your golden years or are planning ahead.