Tiffany Taylor is the Assistant Director of Financial Counseling with ESOP, a subsidiary of Benjamin Rose Institute on Aging. Julie Hayes is the Content Manager at Benjamin Rose Institute on Aging.
Food, gas, phone and utility costs are a fact of life. If your older loved one has to handle these expenses, factoring in additions like insurance, doctor’s bills and medications can quickly tap out his or her bank account. Other strains on the wallet like TV, internet, items bought on shopping trips, eating out and an occasional movie can cause things to spiral out of control unless a watchful eye is applied to the budget.
Without adherence to a budget, your loved one could easily get into financial trouble. A cell phone or cable plan that is too high, for instance, could make credit card payments impossible. Your loved one could have to face the hard decision between keeping an important but potentially costly doctor’s appointment and buying enough food or paying rent. Serious debt could result if your loved one decides to take out loans as a stopgap measure.
The good news is that there are a number of steps you can take to help your loved one get on a manageable budget path, and thus avoid these financial risks. You may want to begin by looking at ways to reduce expenses in the following areas:
Even though utilities tend to account for a large portion of expenses, there are a number of things you and your loved one can do to find relief from high costs when it comes to electricity, heating, air conditioning and other household fees. It may help your loved one to:
· Unplug electronics from outlets when they’re not in use
· Dial down the heat or air conditioning when no one is home
· Keep lights and TVs off unless they’re being used
· Pay attention to the amount of time spent in the shower or running sinks
· Seal chimney flues, windows and doors to save on heating and cooling
· Reduce the water heater temperature from the high 140-degree factory setting to the more comfortable 120-degree setting
· Wash laundry in cold water rather than hot when possible
· Choose LED light bulbs
· Clean out the filters and lint traps of appliances to keep them from losing efficiency
· Contact your loved one’s utility companies to talk about Budget Billing plans
· If your loved one is on a fixed income, look into programs offered by your state that can help, such as the Low Income Home Energy Assistance Program
1. Cable, Phone and Internet Plans
Cell phones, internet and TV have become a major part of staying in tune, but fees can be steep. You may be able to reduce your loved one’s costs if you:
· Bundle services instead of paying for each individually
· Change to a prepaid cell phone plan to prevent unexpected overage fees and set limits on talk, text and data usage
· Get rid of cable channels and packages your loved one doesn’t watch. If he or she isn’t a big TV watcher, you might consider dropping cable altogether.
· Check into prices for cable alternatives such as Roku, Netflix, Hulu and Fire Stick
· Disconnect landline service if it’s not being used
· Explore discounts for older adults on a fixed income, such as AT&T Access, Spectrum Internet Assist™, and Internet Essentials
Shopping is a necessity, but your loved one can easily rack up high expenses if he or she isn’t taking a careful approach. To keep the costs of purchases down, you can encourage him or her to:
· Wait until unessential items go on sale, or buy them when there’s some extra money to do so
· Keep small amounts of cash on hand when shopping, to refrain from using credit cards
· Buy things with coupons or promotion codes whenever possible
· Leave a cushion in the budget to cover unexpected, emergency needs
· Compare prices at various stores in order to get the best deals
· Shop at discount stores or warehouse clubs like Costco for inexpensive bulk purchases. But be sure to remind your loved one not to buy unnecessary items simply because the price is good!
· Find out whether stores he or she frequents offer savings clubs or senior discounts, and avoid opening charge cards, especially at other stores.
2. Grocery Shopping vs. Eating Out
Food is a vital part of maintaining health and should by no means be neglected in the interest of saving money. You can do things to keep costs under control, but you should make sure your loved one never understocks the kitchen or sacrifices a healthy diet to budget concerns.
When possible, cooking at home rather than eating in restaurants is the more affordable, and often the healthier, choice. To keep grocery costs under control, you can encourage your loved one to:
· Use a shopping list to keep track of what’s needed and to avoid buying things that aren’t
· Use a calculator to add up everything that goes into the shopping cart in order to keep from spending more than is affordable
· Compare prices among brands. It can be preferable to invest in a more costly brand if the taste and quality is better, but oftentimes the store or off-brands taste just as good or better for a lower price
· Pay attention to the quantities purchased of food that can easily spoil
· Try not to shop when he or she is hungry, and avoid bringing along hungry guests such as children, who may ask for unneeded snacks or junk food
3. Having Fun
Holding to a budget matters, but so does living a full and enriching life filled with the things that give us joy. Budgeting isn’t about encouraging your loved one to give up whatever he or she loves, but rather is about prioritizing expenses in order to cover both necessities and the activities that matter most. A sustainable budget should leave room for entertainment and hobbies, but to maximize savings, you can encourage your loved one to:
· Scout out free entry or discount days for planned outings, or go somewhere with no entrance fee
· Rely on the local library to access books, movies, audiobooks, music, games and other entertainment items free of charge
· For excursions with friends or a spouse, select activities that everyone likes so that no one wastes money on things that don’t interest them.
If your loved one needs more help budgeting, consider getting in touch with a financial advisor or coach and exploring financial empowerment services offered by organizations such as Empowering and Strengthening Ohio’s People (ESOP), a subsidiary of Benjamin Rose Institute on Aging, to examine their expenses and find more ways to save, tailored to your loved one’s unique interests and needs.
