STRETCHING THE DOLLAR FOR RETIREES

The rising cost of living remains a very real concern for everyone, not just the poor. For retirees from the middle-income group, their primary source of funds is their EPF savings, FDs and share dividends. They must keep a close watch on their expenses, and adjust their lifestyle accordingly. They can't expect to maintain the same lifestyle they had when they were working and drawing a good salary.

Here are 10 tips on how retirees can stretch their savings.

1. Make ONE your favourite number: one home, one car, one credit card, one wife (no girlfriends or mistresses). That should shave off at least half of your expenses. When you keep personal possessions to a minimum, it's much cheaper to maintain them.

2. Downsize. Consider moving to a smaller house or apartment. If all your adult children have already moved out, you don't need a 5-room bungalow that's expensive to maintain. The same goes for your car. Trade in your fuel-guzzler for a more economical Myvi.

3. Cut the fat. Trim the frills. In other words, buy only what you need, pay for only what you use. The Air Asia model. This applies to Astro (cable TV) packages, home decorations and renovations. Do you really need a larger kitchen? Or an LCD flat screen TV in every room? Consider also selling off your club membership if you rarely make use of the club facilities.

4. Clear your debts, mortgages and loans ASAP. This applies in particular to credit card debt. It's so easy to pay just the minimum. But that's how you can end up RM50,000 in the red. You also want to avoid paying late charges.

5. Look out for sales, discounts, and special offers when you go shopping. Adopt the practice of "Ask, and you may receive". Leverage on your age. What have you to lose except a bit of pride? You can get good senior citizen concessions for concert tickets, university tuition fees, meals and a host of other items.

6. Likewise, with privilege cards. Sign up for one, or more. You either get a discount on your purchases or you accumulate points that can be converted to cash or gifts. There are plenty to choose from depending on your purchasing habits.

7. Next up is transport. Save on fuel. Keep the family car for the weekends or special trips. Whenever you can, opt for public transport - bus or train. Avoid taxis at all costs unless you have absolutely no other option. For short distances, use your two good legs. Nothing like a brisk walk to the neighbourhood convenience store to get the papers or a loaf of bread. Good for your heart too.

8. Resist the temptation to acquire the latest gadgets. If your trusty old computer, camera or mobile phone is working fine, why upgrade to a newer and more pricey model? Unless photography is your passion, it's a waste of money to invest in a high-end camera that you use only occasionally for family functions. 

9. Choose generic over branded, buy from government sources rather than private. Bata shoes serve the same purpose as Clarks which can be 3x more expensive. The key word here is comfort, not name. You can purchase prescription drugs from government hospitals and clinics at a fraction of the prices charged by private hospitals and pharmacies.

10. If you love to travel, go economy all the way, from air tickets to budget hotels. Why spend thousands on 5-star hotels when you are in your room only to shower and sleep? The rest of the time you are probably out checking the tourist attractions. A decent 3 or 4-star hotel that is clean and comfortable will do just as well. Also, plan your trips for the off-peak season and save on ticket prices.

Get into the habit of keeping tabs on your expenses. That way you know how much you have spent for the month. This allows you to make adjustments for the coming months. You will be surprised at how much small expenses can add up to at the end of the month. Try it for a month. You'll be glad you did.

Remember, retirement is when you have the luxury of time, not time for luxury. Unless, of course, you have several millions stashed away to see you through the next 10-20 years. But that doesn't mean you can't enjoy your golden years. It's all about careful spending and smart management of your financial resources.