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Retirement: a good time to become a cheapskate

Let’s face it – very few of us will find that, in retirement, we have the exact same take-home pay that we did while working. So for the majority of Canadians, retirement means making do with less income.

An article in the Kiplinger’s Retirement Report takes that thinking to its logical next step – what can be done to spend less in retirement?

The article looks at Florida retiree Walter Gadkowski, who “regularly tools around the neighbourhood when his car runs low on fuel, surveying several gas stations for the lowest possible price.” It mentions that his wife, Linda, sews all her own curtains because that saves her 50 per cent on costs. And of course, they go with separate bills when out for meals with their friends, to ensure they pay only for what they themselves had for dinner.

The danger in retirement, notes the article, is that the price of little things can weigh you down financially. “The book you bought on Kindle. The fancy chew toy you just picked up for the dog. The bottle of wine you gave to a neighbour. ‘People often have no idea where their money is going,’ says Washington, D.C., financial planner Lori Atwood. ‘Everybody thinks it’s nothing, but these little things add up quickly. And when you are on a fixed income, it matters a lot.’”

The article’s advice is to get a handle of where every nickel of your money is going, and then, to “get frugal.” Review everything you are spending money on, and see if there is a way to save. For cable TV, “switch to a less-expensive, no-frills plan,” the article advises. Watch for redundancies – are you paying for more than one similar service, Kiplinger’s asks?

Are you making the most of things like gym memberships – if you are not using them, the article states, then you should cancel them, or look for something cheaper, such as a fitness program for seniors.

Once you are on track with full knowledge of your spending, the article states, it’s time to release your inner cheapskate. Look for discounts online before you buy, and ask about them at restaurants and stores. Find a credit card, the article says, that has a points or cash-back program that suits your spending needs. Be prepared to “go thrifting,” and make purchases at second-hand shops and places like Goodwill.

This all makes sense. In retirement, living is easy, but income is generally fixed. There’s no promotion or big bonus coming where you can “catch up” on overspending. Being frugal and thrifty is a way to make your money last longer and go farther. It’s good advice for retirees, and for those of us who are not yet there.

A wonderful spot for the dollars you save is your Saskatchewan Pension Plan account. A little bit of saving here and there can really add up over the years, and help your fixed income in retirement to be a little more generous.

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. After a 35-year career as a reporter, editor and pension communicator, Martin is enjoying life as a freelance writer. He’s a mediocre golfer, hopeful darts player and beginner line dancer who enjoys classic rock and sports, especially football. He and his wife Laura live with their Sheltie, Duncan, and their cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22