12 Money-Saving Tips to Enjoy a Frugal Retirement

Adjusting to a fixed income in retirement can be a challenge — especially if you’re living off less money.

Just because you stopped working doesn’t mean you stop paying bills and buying groceries. If you’re planning vacations or trips to the golf course — those are extra costs to budget for.

“You could easily spend more money [in retirement] because you have more time you want to enjoy,” Droucelle Ramage, a self-described frugal retiree, told The Penny Hoarder.

Ramage said shopping at thrift stores, attending free community events and choosing community acupuncture rather than going to a pricy private practice has helped her keep expenses low.

Volunteering at her church and local senior center has kept Ramage busy without spending money. When she travels, she’s able to get free flights — a benefit of working for American Airlines for over 20 years.

Knowing how to cut costs is key to having a frugal retirement you can enjoy.

12 Ways to Save Money in Retirement

1. Get a Roommate or Two

Loneliness in retirement can have a negative effect on your health and quality of life. Not only will live-in company help you feel less alone, but you’ll reduce housing costs.

If you live alone, try sharing a place with a friend or family member, or consider coliving with other retirees to save money.

2. Downsize to a Smaller Space

Maybe your idea of a frugal retirement doesn’t include sharing your living space. You can cut costs by moving to a smaller home instead.

A small house has several financial benefits. You’ll pay less in rent or mortgage. Your utility bills will go down. You’ll have less home maintenance and repairs to worry about.

And when you downsize, you can sell all that furniture you don’t need for extra cash.

3. Rent Out Your Kids’ Old Rooms

If you don’t want to sell the family home or get long-term roommates, you can make money off your empty nest by turning unused space into short-term rentals.

Your kids can get their rooms back when they visit for the holidays — or you could make them pay the daily rate.

This guide on how to become an Airbnb host will get you started.

4. Cut the Cost of Groceries

Slashing your grocery spending is a high-impact way to help you have a frugal retirement.

Clip coupons, buy generic products, start a garden and shop at stores that boast low prices, like Aldi or Trader Joe’s.

Bonus: When you feel like eating out, read up on these 25 ways to save money at restaurants.

5. Be Proactive About Your Health

A retired woman leads an exercise class.
Droucelle Ramage leads an exercise class at the Sunshine Center. Ramage keeps her expenses low in retirement by shopping at thrift stores and attending free community events. Chris Zuppa/The Penny Hoarder

Your health is often intertwined with your wealth. Staying healthy in retirement means you’ll spend less on medical costs.

When it comes to preventive care, a balanced diet and regular exercise can reduce your chances of developing conditions like high blood pressure and Type 2 diabetes. But you don’t have to drain your bank account paying for expensive health food or a pricy gym membership.

These 10 ways to save money on organic groceries and this article on tips to spend less on produce will help you eat healthy for less. Incorporate one of these gym alternatives into your routine, or build a cheap home gym for under $100.

If you’re 65 or older, enroll in Medicare. While Medicare coverage doesn’t eliminate out-of-pocket costs, you’ll pay less than with private health insurance.

6. Find Low-Cost Entertainment and Ways to Stay Social

Keep busy in retirement without emptying your wallet.

Fill your social calendar up with events at your local senior center, host potluck dinners with friends or start a murder mystery book club. Check out free offerings at your library, like sign language classes or museum passes.

Turn to this list of 100 free things to do when boredom hits.

Volunteering is another way to make good use of your time, and it could come with neat perks, like free entry to a play when you usher at a theater.

7. Save Money on That Bucket List Trip

You can have a frugal retirement and travel. It just requires some smart planning and perhaps a bit of compromise — like avoiding the peak tourist season or driving instead of flying.

These travel tips will help you keep costs low.

8. Take Advantage of Discounts

Don’t be shy about sharing your age when it’ll result in sweet discounts. Dozens of companies — from retailers and restaurants to airlines and hotels — offer lower prices for seniors. Some offer discounts to customers as young as 50.

9. Continue Your Education for Free

All across the country, there are opportunities for seniors to take free or reduced-price college courses. Be a lifelong learner and take a class in a subject you’ve always wanted to know more about.

10. Shop Secondhand

Instead of strolling through the mall for a new outfit or home decor piece, try thrift stores, consignment shops or online sellers to score deals.

11. Sell Unused Things

You know that china set that’s been collecting dust? Stop telling yourself you’ll pass it down to your kids. Get cash for your dishes instead, along with all the other unused items lying around the house.

Organize a garage sale if you prefer to sell in person. Or go the online route and, sell your stuff online on sites like eBayand lesser-known online flea markets.

12. Pay Off Lingering Debt

The rewards are twofold when you become debt free sooner rather than later. You’ll pay less in overall interest when you pay off your debt early. You’ll also free up more cash once you no longer have that monthly financial obligation.

Paying more than the minimum, negotiating a lower interest rate and making biweekly payments can help you lower your debt load. Here are additional helpful tips on paying off student loans in retirement and eliminating credit card debt in retirement.

Nicole Dow is a former writer at The Penny Hoarder.

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