Retiree's on a fixed Pension....Please read and reply
There are 4,678,284,374,467 topics and discussions on how to prepare for the future, strategies for savings, etc..... Unfortunately, due to circumstances, we were unable to take advantage of all the great advice given, so we have to make due only on government (CPP, OAS) Pensions. We are still using YNAB because it is really working well for us.
We get the pension's once a month and budget as needed. Although the funds are not huge, but the bills are being paid and we have peace of mind. We are taking advantage of Coupons and have now been introduced to Cash Rewards Credit Cards. Every little bit helps.
I would really like to know how my fellow pensioners are making out now that they are done with work. How are you dealing with any shortfalls? Any tips you can give us?
Ron & Judy
It's amazing how much our life has changed since we retired. Because of circumstances, we do not have the financial means to do much traveling or vacationing but that is ok because YNAB has enabled us to other things:
- We still travel but it is pre-planned. Think locally not Europe.
- A new house is not as important as before.
A new car also is not as important as before. We get up every morning with peace of mind knowing that our bills are paid. When there is something that we want to do that requires any finances, we plan it.
We are living on Canadian Government Pensions that give us around $39,950 a year and we are making it happen.
Ron & Judy
My pre-retirement thinking was that I would be living on reduced means in retirement. I embraced the YNAB philosophy that I should budget whatever money I have coming in and figure out how to live on that, so I wasn't terribly worried. I figured that I would have to cut some things out, but I'd get used to doing without them.
Well, after eight and a half years of using YNAB, my employer changed working conditions in a way that annoyed me. I went home, looked at the numbers, and decided to retire at age 60 + 8 months. I still use a YNAB budget, though I deferred starting to use web YNAB until after I figured out how I was going to budget in retirement. It looks different than it did while I was working.
As things turned out, a small frozen pension (based on 6 years' service and my salary as of 1996), plus US Social Security as the surviving husband of my deceased ex-spouse, plus investment income, gave me a margin of safety over and above my initial desired retirement budget. I ended up increasing that budget because I found I wanted to do some things I didn't have time for when I was working.
Now, my major financial focus is managing the investments and ensuring the income grows enough to give my budget a raise for inflation each year. Part of my process each month is to identify underspent budget categories and salvage excess funds; I use these funds to reduce my required draw from investments in the following month.
I still habitually control expenses, as trained by YNAB for a decade. That's part of who I am. I still use the budget to accrue for nice-to-have stuff instead of just spending down the investments. And I am mindful that part of the reason I am in this position is that starting to use YNAB in 2008 enabled me to actually save money at a time when my aspiration was simply to avoid dis-saving.
And if inflation outpaces the growth of my investment income . . . well, there's always the budget. I can figure out where I need to cut to make it work. Next expected major budget challenge: A larger tax bill when RMDs start at age 70. It's a good problem to have.
To Chime in from the US. I am retired at 63, actually on disability. I receive Social Security Disability and Long term Disability. Having a stroke at the age of 50 leading to heart surgury from an undiscovered annurysm, I am lucky to be alive. My stroke was caused by infection. Having spent upwards of $500,000 buty only paying $1,000 - I would say I have great health insurance. When I retired I went on COBRA and was able to extend my COBRA 18 months due to the disability.
I don't kow what will happen when Long term disability stops, another 3 years. But the mobile home is paid off, Credit Cards I pay off each month, and the new car (our last one), should be paid off by then. The lot fees can only go up 3% a year.
So I am just starting to use YNAB, realizing I go on the Amazon buying addiction. Also realezing we are on a fixed income, that will reduce over time. Spending has to reduce!!
I am hoping with YNAB I will have better insights to accomplish this. Now the 401K has to last the rest of 2 lives, there are no second chances.
That's where I sound down in California.
We are just about to retire. I have used YNAB for a few years. I still prefer YNAB 4 but have transitioned to the subscription YNAB. It took a lot of time and learning to be able to use it. I'm at the point of creating the budget based on the CPP, OAS and our retirement investment funds. I am not sure how to set things up. There aren't any videos or real help with doing that through YNAB. If we use tracking accounts we mess up the budgeting. If we use the retirement fund for income, it's a transfer. Does anyone have suggestions?? Thanks