Provided by Derek Cockrell
How Seniors Can Budget on a Fixed Income
Your retirement years offer lots of time to both relax and pursue your passions. But this stage of life also presents some uncertainties, and one of the biggest unknowns for many seniors is how to manage a fixed-income budget. Luckily, strategies like the following can help you enjoy your golden years while lessening the strain on your budget.
“If you have substantial equity in your current home, you may be able to turn a profit by selling it and purchasing a smaller one. Reduced or eliminated mortgage payments, property taxes, and maintenance costs can result as well."
Use Credit Cards Responsibly
Debt is a burden for many seniors, and credit cards are a contributing factor. Try to limit your credit card usage so that you can easily stay on top of your bills. If you're already in credit card debt, one strategy is to pay off the highest-interest account first, thereby reducing your interest expenses. Another method is to focus on paying off lower-interest accounts. As those disappear from your plate, you can use the money that's freed up for extra payments on the higher-interest accounts each month.
Downsize Your Home
Downsizing to a smaller home can offer some direct financial advantages, which is part of why many people are doing it. If you have substantial equity in your current home, you may be able to turn a profit by selling it and purchasing a smaller one. Reduced or eliminated mortgage payments, property taxes, and maintenance costs can result as well. Additionally, downsizing can be an opportunity to move to an area with more perks or a lower cost of living.
Boost Your Income With Freelance Work
Your cash supply may feel more robust with the addition of freelance work, and you may even be able to monetize a hobby by forming a gig business. If you decide to do that, starting a limited liability company (LLC) is a way to streamline the process. Operating as an LLC provides certain financial protections and tax advantages, and it may reduce your paperwork obligations. To avoid costly attorney's fees, you can file as an LLC in New Mexico yourself or hire a formation service to handle it for you. Each state has its own LLC regulations, so research the rules in NM before beginning the process.
Engage in Low-Cost or Free Recreation
When you're on a fixed income, finding low-cost or free activities can help you have fun and stay on budget. Examples of free activities include exploring local parks and volunteering with charitable organizations. Additionally, government-facilitated senior departments are present in many cities, including Clovis, NM. These organizations often run senior centers and host activities that can help you stay busy, make new friends, and preserve your funds.
Take Advantage of Government Benefits
Various levels of government offer perks to ease seniors' financial situations. At the federal level, Benefits.gov is a good place to begin learning about senior-focused perks. It's also worth researching senior benefits from your state and local governments.
Financial Comfort on a Fixed Income
Finding low-cost activities and part-time work, taming credit card debt, and downsizing your home are all ways you can make living on a fixed income more comfortable financially. Enrolling in senior-focused government programs helps, too. These strategies will give you more freedom to enjoy your retirement years.
Derek Cockrell may be reached at (575) 769-3965 x101 or Derek@ContemporaryBenefitsLLC.com
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