11 Ways Retirees Should Never Waste Money

Avoid these nine expenses that can chip away at your savings fund after retirement.

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Updated July 18, 2024
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If you’ve done your math right, the money you’ve spent your working life saving should be enough to help you live comfortably through your post-retirement years.

But no matter how much you’ve saved, your retirement money won’t stretch very far if you’re throwing away money on all the wrong things.

Steer clear of these 11 unnecessary purchases and make your retirement everything you’ve dreamed it would be.

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Home remodels

artursfoto/Adobe worker is putting up wallpapers on the wall

While you’re still working, you can earn extra income through a side gig or increase your short-term savings to fund a home remodel.

Once you’ve retired, though, you have to ask yourself if the potential increase in home value is worth the money you’ll pull from your savings account to afford a new kitchen or bathroom.

Additionally, there’s no guarantee that your remodel will up your home’s value significantly, and if you plan on living there for the rest of your life, you won't ever see the financial benefit.

Consumer debt

Farknot Architect/Adobe woman holding and choosing credit card to use

When you buy something with a credit card and fail to pay off the balance immediately, you’re paying for the upfront cost of the item and then some. Depending on your card’s interest rate, you could end up paying twice what an item originally cost. That’s not even considering credit card fees and late fees for missed payments.

Consumer debt is a bad situation for anyone to find themselves in, but it’s especially problematic for retirees living off a fixed income. You don’t have wiggle room in your budget to spare on credit card interest.

It's important to do what you can to pay off credit card debt before retirement and avoid it once you’ve left the workforce.

Expensive cars, boats, and other luxury vehicles

tarasov_vl/Adobe mature man driving speedboat

Once you retire, you might have a few good years left where you can race fast cars or captain your own private boat. But your vision and hearing will likely get worse as you age. Your reflexes also get slower, which is a major problem when it comes to driving.

While there isn’t a federal age limit on driving, it’s important to be realistic about how many years of use you can really get out of your expensive luxury car.

Honestly, the expense and major hit to your savings probably won’t be worth it. Plus, you may be able to rent a boat to satisfy your need for the open water.

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Unnecessary insurance

peopleimages.com/Adobe couple discussing about documents at home

Once you’re retired, you might start getting more offers than you already do telling you to sign up for life insurance, disability insurance, rental car insurance, and more. But as you age, you might need fewer insurance policies.

For instance, if you decide to give up driving entirely after age 75, you don’t need car insurance, much less a separate rental car insurance policy. Disability insurance policies often end once you reach age 65.

And if you feel pretty secure in your assets, you likely don’t need extensive life insurance policies on top of the value you’ve already accrued.

Phone and internet scams

Daisy Daisy/Adobe senior woman giving credit card details on the phone

Retirees are far from the only demographic who fall prey to scams, but there’s been an alarming rise in the number of scams targeting seniors over the last few years.

According to FBI data, the amount of money seniors lost to scams increased by 75% between 2020 and 2021. As a result, retirees must stay on top of the most recent scams.

Don’t believe every text, voice message, or email you receive, especially ones asking for money or sensitive personal information like your Social Security number.

Remember that the SSA will never require you to make a payment just to get your Social Security check, nor will an agent reach out to you over the phone.

Luxury travel

Nicola/Adobe beautiful resort with blue water and sandy beach on coast at grand turk island

You may be excited to travel and see things you haven't seen before as you set off into retirement. This can be great, as long as you've budgeted for it in advance.

The last thing you want is to pay for luxurious vacations or travel trips that you haven't planned for. This could eat up your hard-earned retirement dollars pretty quickly.

Independent adult children

fizkes/Adobe mother spends time with grown up son

Many retirees still have legal dependents who rely on them for financial support. For instance, you could be the legal guardian of a grandchild or caretaker for a disabled adult child.

But unless a family member is your legal dependent, you shouldn’t be putting money toward supporting them. More than that, most retirees quite literally can’t afford to.

For the most part, adult children under retirement age can still be working a typical job for a typical salary. In contrast, the older you get, the harder it can be to work — which is exactly why you save for retirement during your younger working years.

It can be hard to cut family members off financially, but if your adult child can support themselves, they need to. Your budget can’t handle the strain.

Expensive hobbies

auremar/Adobe couple at a market

Maybe shopping is your passion, or perhaps you indulge in expensive nights out at the theater.

In retirement, though, you can’t count on having cash to burn. If you can replace an expensive hobby with something cheaper, now is the time to do it.

Research free events in your community, such as free family movie nights or concerts in the park. Write up a list of free activities you can substitute for pricey ones, like visiting the library instead of the bookstore.

You can even focus on cutting back instead of quitting cold turkey. Instead of shopping at the Nordstrom Rack, you might try browsing thrift stores and finding used, eclectic, and much more affordable clothing.

College loans

Burlingham/Adobe college graduate with large tuition bill

Whether you want to go after that degree that escaped you or you want to guarantee student loans for your child or grandchild, this can be very detrimental to your retirement.

The more debt you possibly could be asked to repay in retirement, the less likely you are to achieve your retirement goals and have enough money to live how you prefer for the entire length of your golden years.

Guaranteeing college loans can also become burdensome and stressful as you may not know when or how you'll be asked to repay the loan for someone else. Once you retire, you may want to let your family take care of themselves, at least financially.

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Let’s say you put $50,000 into a high yield account at 5.00% APY at 30-years-old. Then, you contribute $5,000 a year, every year, until age 50. With interest compounding daily at that rate, you’d walk away with $303,466.67! But … if you start at age 45, you’d only have $91,898.37.

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Bad investments

peopleimages.com/Adobe mature couple fights on living room sofa

Investing can be a solid way to continue generating income throughout your retirement, but only if you invest wisely. After retirement, steer clear of risky investments promising that you’ll get rich quickly.

Younger people might be able to recoup their losses if they lose money on a risky investment, but retirees can’t afford to lose a chunk of cash and wait a decade or more to get it back.

It’s also smart to avoid long-term investments. Statistically speaking, most 70-year-old retirees won’t be around long enough to reap the rewards of a 40-year investment.

A financial advisor can help you find age-appropriate ways to start investing that make your retirement easier, not harder.

Early Social Security payments

Andrey Popov/Adobe Social Security application

While you can opt to start receiving Social Security benefits as soon as you reach 62, it’s smart to delay your benefits as long as possible.

The further from retirement you are when you start getting payments, the lower the benefits you receive.

Pro tip: Staying afloat with your retirement savings or supplementing your Social Security with a retirement-friendly side gig can help you put off collecting Social Security until you’re 70.

Bottom line

kucherav/Adobe elderly man writing notes in notebook

Retirement should be a time in your life when you can relax, unwind after decades of hard work, and lower your financial stress.

Avoiding these 11 unnecessary expenses will help your retirement savings last longer so you can enjoy your golden years to the best of your ability.

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Author Details

Michelle Smith

Michelle Smith has spent a decade writing for and about small businesses. She specializes in all things finance and has written for publications like G2 and SmallBizDaily. When she's not writing for work at her desk, you can usually find her writing for pleasure near large bodies of water.