Saving and Investing for Old Age
Saving and investing are fairly ancient concepts that have more modern implications for us today. The idea of saving for the future has been around, at least since Biblical times. It was perhaps not the saving of money, but the saving of food that people focused on for millennia. They were saving so that the next year they knew that they’d have seed to plant more land and have food for the following year. It was for the purpose of being sure that they’d be prepared and be able to eat in the coming year.
These days, most people do not live in that manner. They tend to live from one check to another without thought of the future. There are still some rural citizens that practice seed saving and plant crops to ensure that they’ll have food for the following year, but most citizens in modern times tend to work to earn money, then trade money for food. Much can be said about the stability or instability of each system, but suffice it to say, it is wise to save money for the future. It may be difficult to practice, but if you do not practice it, your future could be much more difficult.
Saving is difficult for many. Saving with the purpose of investing is a little more exciting. If you save money and have the vision for investing, you have hope that it will grow over time. When I speak about investing I’m talking about decisions that will directly increase your income. In modern America, many people use the term “investing” to talk about buying a home that you plan to live in or purchasing a newer vehicle. They say that it would be a good “investment”. But the term investing should be saved for things that you put your money toward which will make money for you, particularly if you do not have to be spending lots of your time managing it. An example would be investing in a home that does not need loads of work, renting it out and allowing a reputable management company to take care of the daily maintenance needs and renters communication.
Finding money to save and then invest can be difficult, and if you’re already very strapped financially, saving money might not be an option, you may have to increase your income first. But, if you’re like many Americans, there is normally a little bit of discretionary money available work with. If you re-prioritize the money you have, you may be able to find extra dollars that you can save, and in turn, invest so that you’ll have more to put into a retirement account.
Evaluate entertainment first. Most of us have a bit of entertainment money set aside. Sometimes we get talked into deals that are above what we’d like to spend if we had time to really think through the decision. Take the time to make some calls and find out how you can reduce your spending on entertainment. If you have an internet connection, there are many free or cheap options for watching TV or movies without spending a fortune through a network company.
Think about insurance. Most Americans are over-insured. Over the years they may add insurances without evaluating whether its’ the best deal for them. Take time to go through what it is you want and need and then call around to ask for quotes. Getting the best rates and being sure that you’re not doubled up on coverage might take a few hours, but could save you big money in the end.
Use all your food. There are quotes out there that accuse Americans of throwing out 40-60% of the food that they buy and take home. Either they throw out leftovers or they don’t get around to cooking the food in the first place. This is obviously not the case for everyone, but each of us has room for improvement. Would you walk out of the market and throw half of the grocery bags that you just bought into the trash can? If not, then spend some time researching how you can reduce your grocery bills. Take that money and put it into a savings account that you’ll eventually invest.
Consolidate trips. Gasoline prices fluctuate, and while they’re not terrible at the moment, it is good practice to consider which errands you can run with others in order to save time and money!
These are just a few ideas to jump start the brainstorming process. Saving have never been, nor will it ever be easy. You’ll have to find unique solutions that fit your own situation. If you’re serious about it, however, you can do it. As you save think about how you can grow the money and invest it so that your golden years will be spent on things that you’d like to do!
Save Money While Living on Social Security
Many people wonder how they will make it living on Social Security benefits that they’ve earned while working throughout their lifetime. While the little bit of extra is nice, it is not usually sufficient to support you at the same lifestyle level you were used to before retirement. It requires a great deal of ingenuity to live on this income, especially if you do not have pension benefits or a large retirement savings in place. Both pensions and retirement savings are becoming increasingly rare in our new gig economy, so this particular problem will likely get worse over time. If you find yourself in this boat, of having to rely on Social Security for most of your income, read on for a few helpful tips on survival.
- Be sure your health is covered first. Whether this means that you need to go on Medicare or another type of insurance, be sure that you have a plan to meet your health care needs. It is impossible to predict what types of things might ail you in the next 20-40 years, and it is very harmful to not have a plan in place. Figure something out, even if it’s not as good as the insurance that you had while working, something is better than nothing. If you are struggling with this, talk with Medicare advisors, insurance agents & your friends and family for ideas. Figure something out BEFORE you need it so that your anxiety levels are not high.
- Speaking of health, look into all prevention measures you can take to stay healthy. Handwashing, exercise, nutrition & sunlight are a few basic preventative measures to start with. Once you have those in place, add things like humidity if you live in a dry area, immune boosting activities and/or supplements like echinacea, elderberry syrup, etc. Increase your intake of antioxidants like Vitamin C. Take a probiotic. Laugh as often as possible. Prevention will likely save you a ton in health care costs. A bag of salt for your sidewalk when it’s icy is far cheaper than hip surgery, for instance!
- Your home. If you spend quite a bit on heating or cooling your home, look into ways that you could reduce that expense. Add draft stoppers under doors and windowsills, have someone check outlets to see if they are insulated against cold/hot air entry. Consider closing off certain rooms or areas of the house when it is frigid or sweltering outside. Practice heating or cooling yourself first. Add a layer or two of clothing if you’re a bit chilly, or use a heating pad. Put a cool towel on the back of your neck if you feel hot. It’s far easier to heat and cool ourselves than to heat & cool an entire home, and more cost efficient!
- Your vehicle. Be sure your vehicle has updated oil changes. Also make sure that the tires are inflated to the recommended PSI. Both of these are incredibly easy, but can greatly decrease your gas mileage. Also, consider consolidating trips or carpooling with several people in order to stretch your vehicle expenses. Perhaps this seems extreme, especially if you are not used to coordinating with others for these types of things, but it is incredibly helpful & environmentally conscious to boot!
- You may have to re-think your recreational activities. If you are used to going out to eat or a movie in your free time, you might start to consider getting together with friends for a potluck instead. There are plenty of things that you can do that are helpful to others while also being a time of socializing. Volunteer at a food shelf or charity shoppe alongside other friends. You’ll have loads of time to talk while helping others.
There are tons of other ideas out there on frugal websites and in books. Evaluate your food intake and how you cook. Evaluate what you spend on clothing. Evaluate every cent you spend. You will come up with creative ideas to combat the smaller income you are receiving. Most of all, reduce your expectations of what your life will look like. A good life is still possible with a smaller income!
Extreme Frugality in the Elderly
Have you ever experienced what you would consider extreme frugality in an elderly parent or grandparent? There are varying levels of frugality for each person, but what about things like saving aluminum foil, plastic containers, glass jars or re-using tea bags? It can be somewhat frustrating for those who have not walked the same roads on their journey to watch this process, especially if the saving of things progresses or worsens or becomes problematic because of the sheer quantity of items that are salvaged. But how did it get to this point? Why is there a compulsion to save as much as possible, or not spend, if possible?
For many elderly people this has come through years of experiences that we can only hear about through stories. Many have lived through the Great Depression, WWII, several recessions, not to mention the ups & downs of life that can leave people reeling & thankful that they made it through them. Lack of jobs & food during the depression, rationing of many items during the War, etc. can leave a lifelong impact on the psyche of anyone that has lived through them. If there has been great instability during their lifetime, it is more common for an older person to desire to hold on to things, “just in case”.
And what if you are the person that is slated with the task of helping them keep house, or to clean out their place to prepare for a move? There are a great many relationships that have been strained or broken over this issue. So the first thing to remember is to have grace for the person you are helping. They have been through more in their lives than we can imagine. Remember to treat them with respect & dignity in the process.
Talk with them about their past. Ask about the things that they've been through. Things that seem somewhat irrational to you might be very rational once you've heard their story. Some of them had large families & became accustomed to saving things in bulk because they would get used. They may feel unable to throw things out that have a use. Discuss with them ways that you could donate items so that others may have use of them. If they keep clothes that need to be mended, & are in good condition otherwise, consider hiring someone that could mend them, or ask at a local thrift store that has a mender whether they'd take them. If they have plastic containers, ask in the art department of your local school whether they might have use of them for mixing paints or other art mediums. Get creative in coming up with ways that the items might have real value to others. Yes, this process can be exhausting, and yes, it would be easier just to throw everything out, but it may be terribly offensive to some who have been through so much. What better way to honor them than to take the time to sift down the things of life with them?
If they are accustomed to having many things surrounding them, it may feel a bit frightening to them to have less around for rainy days. Assure them that you will be there for rainy days, because everyone needs assurance of these things. Above all, learn from them & offer them the optimism of brighter days to come!