Today’s preretirees and retirees face several financial challenges in addition to concerns about the world we leave our children and grandchildren, as described in the first part of this series. To face these challenges, we’ll need to make many small, medium, and large steps in our lives that will improve our finances while helping to improve our communities and future generations as well.
With this spirit in mind, let’s look at a dozen win-win strategies and tips for saving money during our retirement years while helping to leave a better planet for our grandchildren at the same time.
Follow your money: Where you live
Many people stay put when they retire, and don’t revisit their living situation. However, that three- and four- bedroom home in the suburbs with a lawn may have been a good place to raise your family or commute into the city, but it might not be the best choice for your retirement life. And if you need to significantly reduce your living expenses, housing costs are a good place to start looking for savings, since they’re the largest expense for most retirees.
Green home tip No. 1: Be thoughtful about where you live in retirement. That idyllic retirement home at the beach, desert, or mountains may not have the same appeal it might have had in the past. Heat, fires, or floods caused by extreme weather events could wreak havoc on a retirement lifestyle in these settings. If you live in an area that’s subject to extreme weather, your pocketbook could get hit by significantly increased premiums for homeowners insurance.
If you decide that these areas might not be for you, then you could choose to live year-round in an area that’s out of harm’s way from wildfires, flooding, and extreme temperatures and just vacation at your favorite beach, mountain, or desert community.
If you’re retired and currently live in a location that’s susceptible to fires, floods, or excessive temperatures, you might want to consider moving to a safer location that’s more forgiving to older people who are vulnerable with reduced mobility. Just don’t wait until you’re too frail and can’t manage such a move.
Green home tip No. 2: Downsize your house. A smaller house will save on energy bills as well as property taxes and maintenance. Townhomes, condos, and apartments are particularly energy-efficient compared with the large, single-family homes in the suburbs. You’ll also have less space to clean and furnish, saving you both time and money. Downsizing can provide other benefits, such as simplifying your life and freeing up assets that you could invest for retirement income.
Green home tip No. 3: Move close to day-to-day retail and service outlets, restaurants, and social settings, if possible. This lets you easily and quickly get your food, entertainment, and enrichment, saving you time and money while reducing your energy consumption.
Green home tip No. 4: Climatize your house. To reduce your electric and heating bills, consider insulating your walls and windows. You could also look into adding solar panels, if they’re practical for your area. If you live in an area that’s susceptible to droughts, consider reducing your water bills by installing a graywater system, water catchment, or drip irrigation. The return on your investment through reduced utility bills can compare favorably to returns on investments, particularly if we’re entering a period of high inflation.
Green home tip No. 5: Replace your lawn with drought-tolerant landscaping that uses less water, gas for mowing, and chemical fertilizers and pesticides. You’ll save money and reduce your carbon footprint.
Green home tip No. 6: Grow your own fruits and vegetables. You’ll eat less expensive, fresher, tastier food compared with what you can buy at the supermarket, and you’ll reduce your carbon footprint by eliminating packaging and transportation costs.
You don’t need to live on a farm to make this work for you. For example, one family in Pasadena, Calif., harvests three tons of organic food each year from their ordinary suburban home on one-tenth of an acre. While most people may not want to grow that much, you may have an empty corner in your yard that could easily accommodate a vegetable garden or your favorite fruit tree.
Added bonuses are that you’ll get exercise as well, thus improving your health, and you could possibly create a magnet for small grandchildren.
Now let’s look at six more tips for being more environmentally conscious with your savings and your life.
Follow your money: your daily spending
Looking beyond your home, you might be able to take many steps in your daily life that can be win-win strategies.
Green living tip No. 1: Use your car less by walking or biking to as many places as possible, and you’ll drive down your costs for gas, insurance, and car maintenance. Not only will you save money on transportation, but you’ll get exercise that improves your health as well.
Here’s a related tip: Take public transportation whenever possible. Since we have more time on our hands, you don’t need to be in such a hurry to get where you want to go. You might even enjoy life more, leaving the driving to others and meeting people as you go.
Green living tip No. 2: If you need to work because your financial resources aren’t sufficient to retire completely, then look for work that’s close to home or is accessible by public transportation. Even better, try to find remote work. Studies show that reducing the time you spend commuting can add to your happiness with life.
Green living tip No. 3: Eat less meat. Factory meat farms use a lot of water and create substantial greenhouse gases and toxic pollution. Eating more plant-based food is not only easier on the environment by using far fewer resources, but it’s less expensive, helping with your weekly budget. It’s also healthier for us as well, which has the potential to reduce your medical bills.
Green living tip No. 4. Buy your vegetables and fruits at local farmers markets. Locally grown produce uses less energy for transportation and packaging compared with much of the produce you’ll find in supermarkets. In the process, you could get more exercise by walking through the market, and you might have fun by getting to know the vendors.
Green living tip No. 5: Buy less new stuff by joining a freecycle or stuff-swap club—they’re a growing trend on social media. You could also consider buying your clothes from secondhand or consignment stores. It’s a great way to meet new friends and move beyond buying the “same-old” new stuff.
Green living tip No. 6: Buy a hybrid or electric car, if you need to replace a car. These cars can help you save money on gas bills and significantly reduce the impact on climate change.
Following your money can be fulfilling
We have taken many of these steps, and we find it’s not a sacrifice. In fact, our lives have been enriched, not diminished. We say this not to brag or preach, or to imply that we’re perfect – we’re not. We constantly look for new ways to cut the money we spend on energy and new stuff.
We merely want to make this point: Helping to improve our communities and making ends meet in retirement can be rewarding for both your pocketbook and for your sense of life satisfaction. We can still have a good life if we commit to ourselves that it’s important to improve our finances and leave a better world for our grandchildren.
Of course, there are many other tips for saving money that don’t impact the environment, just like there are many ways to help the environment that might not save you money. We’ve just focused here on win-win strategies to help you with both goals.
Once you get started, you might be inspired to think of more ways to help with the environment and your own health and financial security. Be sure to influence others by sharing your actions with your family and friends—be the ripple in the pond. Let’s make our retirement work and leave the world a better place for future generations.
Steve Vernon, FSA, is an actuary who conducts independent research on the most challenging retirement decisions. He’s the author of six books on retirement planning and he has conducted hundreds of retirement planning workshops. He recently completed nine years consulting on retirement strategies for the Stanford Center on Longevity.
Harry R. Moody, Ph.D., is retired Vice President for Academic Affairs for AARP. He is Visiting Faculty in the Creative Longevity and Wisdom Program of Fielding Graduate University.