Living Well on a Fixed Income

Retirement should be fun! You worked hard all your adult life. For most of us, retirement is the time we look forward to, time to enjoy adult children and grandchildren, time at last for the hobbies we were only able to allot minutes to while we were employed, time to give our energy to the volunteer organizations and charities we support, time for travel, and time for rest and relaxation.

Instead, what many retirees face during this economic downturn is severe anxiety over finances. For those lucky enough to have a portfolio, 401K or IRA, the value and consequently the income we can draw from them is significantly reduced. Our pension plans and social security don't seem to be getting cost of living increases but that hasn't stopped the cost of living from going up. We are stuck between a rock and the lifestyle we were looking forward to.

Or are we? While big miracles may not happen often, (Why do you think state lotteries make money?) you can take seven small steps to bring your income more in line with expenses and still enjoy the rich and full retirement life you were anticipating. It really is the little things that matter!

Step 1. Look hard at your monthly expenses. Where can you cut them and not feel the pain? Automobiles, energy, food, entertainment, medical bills, home costs-these make up most retirees monthly bills . They can be reduced without any loss of quality of life.

Step 2.No Pain at the Pump -- Do you really need two cars? If both you and your spouse or significant other are retired, you can halve your auto costs by getting rid of that second car. Just think about it-that's half the gasoline, half the maintenance costs, half the insurance. Beginning to get the picture? Yes you will have to coordinate schedules a bit more. But if it means being able to save enough to take the dream trip to Paris you've waited a lifetime for isn't it worth it?

Step 3. Consider Refinancing. Most seniors still have a mortgage. Many seniors have significant equity in their homes and excellent credit ratings. We've earned them from years of paying our bills on time. Take advantage of these two factors and consider re-financing your home at a lower interest rate. With a fixed and lower income, monthly cash flow can be a problem. I was able to reduce my monthly mortgage payment by $300 simply by refinancing. Yes there is a lot of paperwork involved and yes again, credit is harder to get in these difficult financial times, but what good use could you put $300 a month to?

Step 4. Save Energy, Save the Planet, and Save Money-all at one time. Don't use your entire house? Don't heat it. Remember in the good old days when bedrooms weren't heated during the day, when the family sat in the kitchen or around a stove or fireplace in the living room, and people put on sweaters when it was cold and kept the thermostat at 65 degrees? Nobody died. We enjoyed each other's company and heating bills were lowered. Nothing is preventing us from returning to the best parts of those days. If you're not going to be in the house for a big portion of the day, turn the thermostat down or up if it's summer. If you rarely use a room, shut the vents to it. In the spring and fall on temperate days turn your system off and open the windows. Turn your water heater down. Wash clothes in cold water when possible. Hang them outside to dry. Don't leave appliances like phone chargers plugged in. They steal power and run your bills up. Keep your air filters changed and your HVAC system in good working order. Good maintenance will lower your energy bills. If you haven't done so already replace your light bulbs with florescent bulbs. I reduced my average monthly energy bills by $100 just by taking these small steps. Paris is getting closer every day.

Step 5. Lower Your Medical Bills- you can't help getting sick. Alas, it is really true that body parts do seem to wear out and need repair as we age. Most of us need to take at least some medicine on a regular basis to keep us healthy. But you can reduce your medical bills and still benefit from quality health care. In fact you can reduce your bills and improve your health care. Here's how! Always bring your formulary (a list of all the medicines you are currently taking) and a written list of your concerns when you visit the doctor. This will save you both time and may result in a lower fee for the visit. Always ask your doctor for the generic brand of any drug he/she prescribes. Ask if the doctor has samples he can give you.

Always ask if a particular test the doctor recommends is really necessary or is there a less expensive alternative. Can the surgery be safely done on an outpatient basis? Could you administer your own anesthetic? OK there is a limit but you get the idea.

Shop pharmacies. I like a small local (non-chain) pharmacy where the pharmacist knows my family and they deliver free of charge but they were more expensive than the big box store. I asked if the pharmacist would match their prices and to my pleasant surprise, he agreed. OK, it's a pain to transfer prescriptions, but if it saves you big bucks (and it could over the span of a year or more), it's worth it. Paris is calling.

Step 6. Save A Bundle at the Grocery Store? No you don't have to eat less, although for some of us that might not be a bad idea. With a little planning, you can cut the time you spend to shop and cut your food bill almost in half. As a working woman, I never clipped coupons. I told myself I didn't have the time. Well now I do (and the truth is I probably always did). I clip coupons, from the newspaper, from on line sites like Coupon Mom.com, from store flyers. I don't clip them for anything I wouldn't otherwise buy anyway. I compare prices and if the store brand is less than the name brand, even with the coupon, I'll buy the store brand. I organize my coupons in a three ring binder with dividers for each major food category (Example: cleaning supplies, dairy, pet needs, etc.) and house the coupons in plastic baseball card holders. It takes me around 15 minutes weekly to keep my coupons up to date and I usually save between $5 and $15 a week. That's pretty good pay for my time.

I shop with a list and I don't buy anything that isn't on the list (unless it is a really, really good buy). Of course I shop the store specials. Most stores now put their weekly specials on line. Go to their website. Sign up and you don't even have to buy the newspaper.

Here's how to handle the BOGO specials. You're cooking for one or two and don't really need the extra can of tuna or package of pork chops. Ask a senior friend if they'd like to split the cost or ask the store if they'll give you one at half the price. They frequently say yes.

And let's talk about cooking for one or two. It is much less expensive than buying prepackaged meals and better for you. Here are a few tricks to keep you from eating the same pot of soup all week. (Unless, of course you really want to.) Cook for 4 and freeze half. Plan your meals so that today's meal becomes something else tomorrow. For example, we just finished a delicious meal of meatloaf, potatoes and parsley, and cabbage with diced tomatoes. Tomorrow we're having a hearty cabbage soup made with the leftovers.

Stock up on staples like canned tomatoes, tomato sauce, kidney beans etc when they're on sale. You can always use them and they won't go bad on the shelf. Use your store discount card. The store I do most of my shopping at also gives a 5% senior discount on Wednesdays. Guess what day I shop? I bring my own bags because they give me 5 cents for every bag. I save 10 to 20 cents each week. Over the course of a year that's enough for a nice lunch at a French café. I feed the two of us and frequent guests very well on about $40 a week using these tips.

Step 7. Entertainment - No you don't have to stay at home and watch TV. There's so much out there that's fun and free for seniors. You just have to be a little enterprising. Use your senior discount. If you don't see one offered, ask for it. Restaurants and movie theatres often offer senior discounts in the afternoon or early evening when business is lighter. The movie or meal is exactly the same whether it's 5:30 or 8:00 p.m.

Offer to usher to see performances free. Our town has an annual arts festival and I've seen all kinds of very expensive performances for free because I usher.

Does your community have a senior center? See what they've got going on there. Oh you say, I'm not that old. They're just a bunch of doddering gray hairs. You might be surprised. Our senior center offers bridge, yoga, knitting, quilting, current movies, potluck suppers, a book club with lively discussions, and more. And it's all free. Don't have a senior center in your area? Then start one. Many churches will offer space for seniors to meet. Seek folks with similar interests and meet regularly. Viola! A senior center.

Use your local library. Many now have on-line catalogues and e-books. Many offer computers and internet access. Some have book clubs and interesting speakers or monthly movies. And it's all free! I used to spend $40-50 a month on books. OK, it was my personal addiction. I now read exactly the same amount if not more. I just don't pay for the books. Yes I did have to give up underlining and writing in the margins but that's a small price to pay for the Champs Elyse.

Finally, when you actually to take that trip to Paris (or wherever it is your heart is set on) use all the frugal traveler tips available on line and elsewhere these days. Remember, you're retired. You don't have to take your vacation during summer when all those working people are crowding the roads and airways and the hotels are charging top dollar. Plan your trip for off season when rates are lower. Take advantage of frequent flier and other discount cards. Comparison shop. You're free to take those last minute deals that those with fixed schedules can't. If Paris was your goal but Luxembourg is $299, you can always take a side trip.

Try one or more of these seven steps and see if you don't save money and have fun while you're doing it. And I have one more step for you. Conversation. Yes, talk about all the ways you've found to save and enjoy your retirement at the same time. I'm always getting new frugal ideas from my friends. Did I mention I've recently changed my phone to a less expensive company with exactly the same service? Sorry, I have to run now. My ride to the airport is honking her horn. Au Revoir!