Retirement is a stage of life every adult aspires toward. While everyone may be looking forward to the days of no work and all play, many are also considering just how much money they will have available to fund their retirement dreams.

Living on a fixed income may mean taking a hard look at your monthly expenses. If you are nearing retirement and need to cut costs, there are several ways that you can reduce your housing costs in retirement. 

Pay off your mortgage

If you are like most people, your mortgage is a large percentage of your annual expenses, which means it is also a huge monthly expense. Paying off your mortgage will reduce the amount you pay out each month and in turn leave more money during retirement.

Paying off your mortgage is of course easier said than done. If possible you should try to make larger payments than required each month in order to pay down your debt more quickly.

Relocate

If you are living in a relatively expensive area and are concerned about having enough money set aside for retirement, you could sell your current home and relocate to a more affordable area. The cost of living has increased across the country, but hasn’t affected every location equally.

When choosing a new area to live, take a close look at property taxes. Your real estate agent should provide you with a list of county by county property taxes in your search area. You’ll want to look at the property’s price history as well as the monthly breakdown of the property’s taxes.

In addition, you should take a close look at reduced tax rates or exemptions for seniors. Some areas allow seniors to pay very little or nothing at all on property taxes. 

Downsize

Sure, you needed four bedrooms when you children lived at home, but now that the children have left the nest and you are aging, is there really a need for so much square footage? If you feel there isn’t, you should consider downsizing to a smaller property.

With less home to care for you costs will be lower (utilities especially) and so will many repairs (a smaller roof is less expensive to fix than a larger roof.)

If you can sell the property you are currently in and purchase a smaller property without increasing monthly mortgage costs, you should definitely consider a small living area. To begin the process of downsizing, first find a trusted real estate agent to guide through the home selling and buying process. 

Make home improvements that benefit aging

If you really want to stay in your current home, you should begin considering how to make your home safe and accessible. Add motion sensor lighting to your hallways and make your floors safer with low-pile carpet or slip resistant flooring.

You should also revisit your bathroom design, kitchen features, and outdoor entry and exit areas. Remember that as you age, mobility may decrease and the chance of injuries can increase. 

Invest in Energy-Saving features

High tech features may seem like investments only young adults would enjoy, but they are actually very useful for seniors looking to cut costs. Lower your monthly energy bill with energy efficient lighting and Energy Star certified windows.

You should also upgrade to smart appliances and a smart thermostat. Both of these home improvements will reduce energy usage and in turn lower your monthly utility payments. 

Don’t wait until you are years into retirement before examining your expenses. With a fixed income you need figure out how to make ends meet with careful financial planning and strategic cost-cutting. 

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