The traditions that come with the holiday season bring joy to many, but have you considered if anything needs to change now that you’re retired? It’s easy to get caught up in the holiday buzz and splurge on gifts for the grandkids, trendy new decorations, and sugary treats. Just when pumpkin spice lands on every menu, we’re tossed into a Thanksgiving blur that is quickly overtaken by holiday shopping ads and Salvation Army Red Kettles.
We want you to continue enjoying the holidays as you always have, but it’s important to simultaneously look out for your finances. Planning can allow you to bring that joy and energy into the new year, instead of feeling regret when you receive your first credit card statement in January. To help, we have 5 topics for retirees to consider before heading to the mall or filling online shopping carts.
Freeing Up Funds for the Holidays as a Retiree
You know how to set a budget, we’re not here to tell you what you can or can’t spend on Christmas gifts this year. This is a gentle reminder to think about where the money will come from to cover added expenses if you haven’t been setting aside money for the holidays.
Here are a few creative ideas:
Consider pausing subscriptions you can go without or simply won’t use during this busy time of year. Gym memberships, TV streaming services (especially if you have multiple), and audiobook apps are just a few examples of monthly costs that add up.
If you’re 72, you may be required to take Required Minimum Distributions from your Traditional IRA or 401k. Consider viewing part of the withdrawal as a bonus you can set aside for holiday spending.
If your holidays are filled with family gatherings, extra luncheons, or platters of sweet treats — reconsider when you’re eating out. Skip the drive-through, eat at home when you can, or invite friends over for coffee instead of meeting at a coffee shop.
Don’t Forget About Travel Expenses or the Cost of Hosting
Where are you headed this holiday season? Will you be driving or flying long distances? As retirees, you might also be staying put if you're the head of your family, welcoming your children or others home for the holidays.
If you’re traveling this holiday season — consider flying on non-peak days to reduce the ticket costs. See this as a perk of retired life, you no longer have to plan around your work schedule. If you’re hitting the road, consider packing a small cooler of snacks and beverages to avoid unnecessary convenience store purchases.
If you’re hosting this year — remember it’s completely ok to ask others to bring a dish to pass. This will not only help you save a bit of money but can reduce the stress that comes with preparing large meals. You can also plan for overnight guests by stocking up on a few breakfast essentials to avoid costly meals out for large groups.
Start Shopping Early
If there are specific items you’re buying this year, start shopping early. Take the added few minutes to compare costs between stores — this is easier than ever thanks to online shopping. We’ve all seen the effects of strained supply chains over the past couple of years; starting your holiday shopping early is the best way to make sure you get the hot items of the season.
Starting early also allows you to spread out the added holiday costs. By shopping for gifts in October and November — the costs of travel and hosting won’t hit your bank account at the same time as gift buying.
Consider Turning off the TV
Turn on the news and you’re sure to find continued talk of the recession, inflation, and an unsettled market. These doom and gloom reports can bring feelings of guilt to those of us that are inherently frugal.
If this is you, then take these headlines as a sign to take the bit of extra time to plan ahead. Just like retirement, careful planning can make all the difference. Don’t let the news tell you if you can have a normal Christmas. Remain confident in your planning and preparation so you can enjoy the holiday season, and maybe focus on turning off the TV or spending less time scrolling.
Don’t Forget to Give this Holiday Season
Giving doesn’t have to look the same for everyone. Whether you pull out your spare change when you hear the Salvation Army bells, donate gifts to local charities, or drop a few extra dollars in the offering plate at church — we encourage you to give this season to support your neighbors in need.
Most importantly, remember what this season means to you. Use that meaning to keep your spending in check before splurging on unnecessary purchases. Our hope is that you enjoy time with loved ones and continue traditions that bring you joy — for us, this is what living your retirement life to the fullest is all about.
About Integrated Wealth Management
Integrated Wealth Management is owned by Burt Hutchinson, CPA, CFP®. We’re a CPA-led organization, meaning we’re here to handle your complex tax scenarios and provide cost-saving insight related to your financial plan.
We’re here to guide you through the 3 stages of retirement:
Uncertainty Stage: When you are within 10 years of retirement and have questions about how to make it work
Stability Stage: When you have reached the financial milestone to retire comfortably and confidently
Reflection Stage: When you are looking to leave a legacy
We are also here to provide experienced, empathetic support during times of loss, such as the death of a life partner. You need confidence and a sense of security to enjoy retirement. As fiduciaries with a fee-only structure, we never receive commissions. Free of ulterior motives, you can be sure we’re focused on your goals.