Retirement Retirement Planning

12 Reasons Scrimping Now Could Pay Off Big in Retirement

Saving more than you planned for retirement could help you get more out of your post-work life.

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Updated Sept. 24, 2024
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It can be daunting to save money for retirement, and you may just be planning to hit an amount and turn in your resignation letter.

But there may be good reasons for you to continue working to grow your wealth or raise your goals for how much money you want to save before you retire.

Here are a few reasons you won’t regret saving more money before you start retired life.

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You don’t want to worry about monthly expenses

doucefleur/Adobe woman at home calculating monthly expenses using calculator

Just as it can be tough to stop living paycheck to paycheck when you’re working, it can be stressful to live month to month when you’re retired.

Adding extra cash to your retirement savings can give you some peace of mind each month when you have you pay regular bills like utilities or a mortgage without having to bust your budget.


More money gives you more options

Feel good studio/Adobe senior couple enjoying vacation at lake como while sitting on beach

One of the biggest reasons you’ll want to save more money is that it will give you more options.

Think about what you’ll want to do when you retire, such as going on more vacations or devoting more time to your hobbies. Those things all cost money, and having more could affect the hotels you can afford when you travel, for instance.

Healthcare will be expensive

goodluz/Adobe senior female patient at clinic getting reassurance from female doctor

Healthcare costs continue to rise, which could make a significant dent in your savings if you don’t save enough.

Take into account basic healthcare costs, including doctor visits, prescriptions, and other healthcare aids.

You’ll also want to factor in insurance such as private insurance costs or supplemental insurance when you’re on Medicare.

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Consider long-term care

WavebreakMediaMicro/Adobe female doctor standing with male patient on walker

A big issue when it comes to money after you retire is long-term care, which can eat away at your savings.

Try to save more than you expect for long-term care like assisted living or a nursing home. You also may want to consider long-term care insurance to help you cover additional costs for care.

You need to cover emergency spending

Panumas/Adobe two suv cars crashed into each other on road in fatal accident

Even when you’re retired, emergencies will crop up that will require you to spend extra cash, like a surprise home fix, a health issue, or a car accident.

It’s a good idea to make sure you add extra to your emergency fund before you retire so you have enough to spend on surprise costs.

And remember that you won’t be earning money from a job if you do have to use emergency funds, so it’s a good idea to have more in there than you think you’ll need.

Social Security may not be enough

JohnKwan/Adobe social security cards placed on top of a stock market paper

Social Security is a great benefit to have when you retire, but it can also affect how much you need to save.

It’s a good idea to test out the calculator on the Social Security Administration’s website to see how much the department estimates your monthly benefits will be.

Also, if you start taking benefits early in retirement, your monthly checks will be lower than if you delay them. As a result, you may need to make extra money to supplement your Social Security.


You can spend more on little things

Prostock-studio/Adobe Happy senior couple sitting on couch together holding cup of coffee at home

Perhaps you’re looking forward to eating at restaurants when you have more time to enjoy them, or you want to update your wardrobe for a post-work life.

Things like dining out, clothing, and other small expenses can add up when you’re retired. So consider whether you would prefer to cut your budget and spend more time cooking at home or save some money now to enjoy those extra things later.

You still need to cover home expenses

Daenin/Adobe real estate agent showing calculator with mortgage amount to client with house sculpture and papers on table

Just because you’re retiring from work doesn’t mean you can retire from bills.

Take into account things like utilities, your mortgage, or property taxes when you retire. The cost of utilities and taxes could send your budget into a spiral if you don’t account for those increases in your retirement budget.

You want to move

Fabio/Adobe happy senior couple holding keys of new house

Retiring could mean you’ll be able to move to a new home or a warmer city. It also could mean downsizing to a smaller house now that your kids are older and have moved out.

But moving costs money. You may have to pay movers or closing fees if you buy or sell your home. Locations with a warmer climate could have a higher cost of living depending on the area you choose.

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You can stay in shape

Kay Abrahams/peopleimages.com/Adobe senior couple running in park

As you get older, you’ll want to do what you can to stay healthy like join a gym or take exercise classes.

Staying in good shape can cost money, so make sure you set aside some extra cash for a gym membership, trainer, or classes to make sure you can stay as healthy as possible.

You can pay off debt

gustavofrazao/Adobe circling the date with pay off debt

One thing you may not have factored into your retirement budget is debt, which will follow you into your post-work years. It’s a good idea to save some extra cash while you’re still working so you can get out of debt before you retire.

Consider paying off credit cards, high-interest loans, and any car loans, and see what you can do to reduce or even eliminate your monthly mortgage costs.

You can relax

Monkey Business/Adobe man wearing sun hat relaxing on hammock

You don’t want to spend your retirement years being as stressed out as you were when you were working.

So save what you can while you still have an income and add some extra padding to your retirement.

You’ll be thankful you did when you can sit outside and enjoy a book or find time to spend with friends and family without the stress of financial issues constantly looming.

Bottom line

rawpixel.com/Adobe happy senior couple chopping vegetables in kitchen

Remember to create a budget now to help you find additional places to boost your bank account for your retirement to cover expenses as well as extra spending on vacations or hobbies.

It’s also a good idea to create an estimated retirement budget now so you’ll know how much you need and then adjust it to make sure you’re reaching your goals.

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Jenny Cohen

Jenny Cohen is a freelance writer who has covered a bit of everything, from finance to sports to her favorite TV shows. Her work has been featured in The Wall Street Journal, USA Today, and FoxSports.com.