Expenses in a United States home are increasing year after year. This is due to the constant inflation that every country in the world is experiencing. As a general rule, retirees who collect only a Social Security check may see this in a more negative light. It is not usual for Social Security checks to increase too much, quite the opposite.
Even though the COLA means that this year we have seen a Social Security increase of 8.7%, this does not mean that retirees are financially safe. In this regard, there are certain things we can do to avoid going under financially when we are collecting a Social Security check as our only source of income.
In the realm of making large purchases, there are times when retirees do not take into account some fundamental aspects. The Social Security check should be for payment of monthly expenses, at least on a regular basis. It is not advisable to use the retirement check for extra expenses. For that we must have an alternative source of income or savings.
Purchases that can ruin your Social Security retirement
While it’s true that everyone has their own tastes and preferences, there are certain large purchases that should be made with great caution. Spending all of your Social Security – or a large part of your monthly check – on these purchases can sink you financially. Do you plan to make any of these purchases?
- A luxury car. No one really needs a luxury car. It’s okay to like it because it’s normal to love this kind of thing, but no one really needs a luxury car. Any other cheaper car does exactly the same thing and doesn’t require us to spend years’ worth of Social Security check. Also, to save more we should think about using public transportation.
- Eating out. Cooking at home is an activity we can do alone or with company. It can help us exercise our memory and is a fun pastime. In addition, it is much cheaper than eating in restaurants, since lately they have even higher prices. Try to eat out only on special occasions.
- Expensive gifts for the whole family. You have to watch out in this section. It is more common than it seems that retirees give very expensive gifts to young relatives. This may be fine sometimes, but not all the time. In order to pay for those gifts we will have to spend a large part of our Social Security check, so we could get in trouble ourselves.
If we want to have this series of expenses without worrying about our Social Security check we can always have some outside source of income. In that case, we must control the economic aspect very well so we don’t forget to pay the corresponding taxes, as well as the rest of the bills.