Single women: How to live frugally and plan retirement

Single women: How to live frugally and plan retirement

Good Nelly is a financial writer who has been associated with several financial communities for quite a long time. She analyzes financial happenings and writes articles to aware and help her readers plan for their financial future. We are so glad to have her a guest blogger this week. You can find more of her work My Way of Viewing.

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“Your pleasure in saving money should be equal to your pleasure in spending money.”

It doesn’t matter whether you are single or married, you’d have to save for your golden days to build a financially secure future.

Single women How to live frugally and plan retirement

Tips for a single woman to practice frugal living:

It is not much difficult to save a significant amount from now on for retirement. What you have to do is practice frugal living. Now, it doesn’t mean that you have to compromise everything to save money. Just that you’ll have to save a significant amount by avoiding unnecessary expenses.

Here’s how you can practice frugal living to save money:

-Choose an apartment with luxury amenities.

-Many times, you may unknowingly spend more for your luxury amenities like opting for a sports club membership or enrolling separately for a gym, pool, etc. However, being a single woman, you can easily save this amount by renting an apartment in a building with such facilities.

-Moreover, staying in such a place is also great for networking and getting acquainted with your neighbors to have a rich social life.

-Plan a realistic budget.

-You have to plan a budget to calculate and increase your discretionary income. Usually, people living alone, especially women, tend to spend more on shopping.

-So, plan a basic budget to analyze how much you can save every month. Now, if that amount doesn’t look nice to build a good retirement saving, then you’d have to work on that to increase the amount.

-Try not to spend more than $100 per week on miscellaneous things.

-Have home-cooked meals.

-Having home-cooked food is not only a money saving strategy but also a healthier alternative. Plan your weekly meals and shop what you need.

-Though you’d have to prepare meals for one, yet you can make it in a large portion and carry it to work the next day.

-Purchase grocery items in bulk.

-When it comes to grocery shopping, it always makes sense to buy in bulk the items you need regularly.

-However, before buying in bulk, check out the expiry dates on the items and be sure that you can consume them before.

-May consider changing your cell phone plan. Have your every analyzed whether or not you’ve been paying for an unlimited data when you don’t need it? If so, choose a cell phone plan as per your requirement, and save precious dollars.

Negotiate to reduce credit card interest rates.

-When it comes to saving dollars, every little penny counts; and when it’s about interest rates on credit cards, you’ll save a significant amount if you negotiate for lower interest rates.

-If you’ve been a loyal customer, then the credit card issuer may lower the rate of interest on your card.

How a single person can plan for retirement

Researchers point that the singles tend to save less for retirement in comparison to the married couples.

As per a research conducted by the National Bureau of Economic Research in 2011, an average married household manages to save about 10 times more when they retire as compared to the single-person households.

The study also pointed out that on a per-person basis, the cost of living for singles is about 40-50% higher than that of married couples.

One of the reasons may be that the single persons have less discretionary income than their dual-income counterparts. And, it is a greater concern for women since they tend to earn less in their jobs and they usually live longer.

Make saving a necessity.

So, being a single woman, you should start early to save for retirement and make your retirement planning, so that you have enough time to execute it.

Dedicate an account just for retirement and start saving with a small amount. Do not use the fund anywhere else.

According to Melissa Motz, president of Motz Wealth Management and a wealth adviser, “Put retirement savings right up there with housing and food as a priority.”

Calculate your net worth

To start planning for retirement, first of all, you need to compute your net worth. It means calculating your assets minus your liabilities such as debts.

When calculating assets, consider your house, cash, investments, any other real estate, vehicles, along with any other valuable things.

Though it may seem a bit difficult, it is necessary to make your retirement and future planning for a secure financial future.

Gather required knowledge.

Sufficient financial knowledge is a prerequisite to making the right retirement planning. However, as per a survey conducted by Prudential Financial, only 7% women gave themselves “A” grade when they’re asked about their knowledge of investing.

A study, conducted by TIAA-CREF, revealed that about 63% of women, who received financial advice, felt that they have started saving enough for their retirement.

Plan for your future early

Single persons often don’t spend much time planning for retirement as much as most of their married counterparts do. But, it is important to create a vision and work towards achieving it.

Being single doesn’t mean that you don’t have any other goals. You may want to travel abroad, start your business, etc. where you need lump sum amount.

So, create what you want to achieve at retirement and plan to attain that.

Build your financial security all by yourself. 

You have to plan your retirement as you can’t depend on your spouse’s income. First of all, start by building an emergency fund worth of 3-6 months of your living expenses. It is better if you build an emergency savings fund worth of 9-12 months expenses.

Along with it, if needed, talk to a financial adviser and discuss how you can build your retirement fund.

Since you’re the only breadwinner, you should also look for long-term-care insurance.

Do not sacrifice your financial security to help others.

A number of women sacrifice their financial security to help others, their loved ones. But, especially when you’re single, you should put yourself first and know where to draw the line.

For example, do not stop saving for retirement to saving for your child’s education. Remember that children can borrow to fund their education but you can’t take out a loan to fund your retirement.

In addition to this, differentiate between good and bad financial advice. And, don’t try to help a family member financially if your financial condition doesn’t permit you to do so. Do not go beyond your limit.

Pay off debt as fast as possible

It becomes difficult to attain your retirement goals with debts to pay off. So, you should try not to incur debt, especially credit card debt. Always charge your card for an amount that you can repay comfortably at every billing cycle.

However, if you’ve already incurred debt, then you can follow debt reduction strategies to pay it off as soon as possible so that you can focus on saving and investing for your golden days.

Sort out legal issues you need to

If you want you can assign durable powers of attorney for both your finances and health. Doing so, you can ensure that your medical and financial decisions are made by a person you trust instead of a court-appointed guardian or a relative making such important decisions.

Make sure you prepare these legal documents early.

So, what do you think? It isn’t impossible to plan a financially secure retired life. So, follow these tips and achieve your financial and retirement goals, one by one.

Here are a few more money saving tips that people love on the blog:

Stop letting finances control you: Tips for the Frugal

The best money saving tips for Frugal people

Tips that the Frugal don’t share about saving money

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