SENIORS CONSIDER FINANCIAL QUESTIONS

Feb 19th, 2012 | By Sharon Shaw Elrod MSW EdD | Category: Senior Finances

Financial Issues at Top of ‘Top 10 Concerns of Seniors’

Senior citizen financial concerns are at the top of the Top Ten Concerns of Seniors. That is because most of us live on fixed incomes, and we want what investments (if any) we have to last our lifetime.  Most of us just don’t have much of a cushion to fall back on in an emergency.  We depend on what little interest we get from investments to supplement our Social Security benefits.  We need both the benefits and interest income to survive.

An example that recently was shared with SeniorCitizenJournal.com editors help to highlight a system that can provide assistance in making decisions about where and how to spend money in retirement.

A retired couple lives in their own home, which is paid for.  Their income includes two Social Security checks, limited investment income and a pension.  They live comfortably but not extravagantly.  They recently talked about whether or not they could/should add on a storage unit to their garage for lawn and garden equipment storage. These are the issues they considered in making their decision:

  1. They carefully evaluated their annual budget to see where the money might come from to pay for the addition.  They use their budget religiously to ensure their financial safety with all decisions about how their money is spent.
  2. They sought three bids from companies who were recommended to do the add-on room.  All three bids came in within reason from their perspective.
  3. After consulting their budget, they determined the cost would exceed their income from Social Security, the pension and investment interest; if they were going to add on the room, they would have to sell some of their investments to pay for the room.
  4. If they sold some investments to pay for the new construction, their total invested funds would diminish, and as a result, their interest income would diminish.
  5. Since they require all the income from interest to meet their basic needs, they determined they should not construct the storage room because it compromised too much of the income they depend on.

This couple was very deliberate in their evaluation of the project.  Their final decision was to forgo the new construction, and continue to live with lawn and garden tools in their garage.  Their budget drove their choices, and as a result, their basic needs are not compromised.

 



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