Debt is never a light weight to bear, but it can feel manageable when you have a steady income. After retirement, however, controlling your bills can quickly become overwhelming without the promise of a regular paycheck. If you retired with outstanding debt, use these tips to manage your finances.
Enlist the help of a professional
If you’re in retirement and still trying to handle incoming bills, you should seek the help of a financial professional. Daily Finance recommended consulting with a certified financial planner, as he or she will be able to construct a reasonable retirement plan for you, taking into account all of your existing debt and resources. The source explained that CFPs can be instrumental in creating budgets for seniors that not only allow them to become debt-free, but may actually help them build up their savings. A professional can also help you identify and organize your potential sources of income post-retirement.
Understand what resources are available to you
A major part of eliminating debt is taking advantage of all the resources available to you. Not only does this apply to getting the most out of your pension, but it also means recognizing what services are available to you when it comes to financing utilities, food, medicine and health care. Your CFP may be able to help you identify some of these resources, but you can investigate them for yourself through the National Council on Aging’s EconomicCheckUp website. This helpful resource can walk you through everything that has to do with your personal finances, from refinancing your mortgage to acquiring Social Security.
Additionally, talk to your family about your financial situation. Even if your children or siblings are unable to offer you monetary support, they may be able to help you sort through the variety of resources available to you.
Control your credit
When used correctly, credit cards can help you make the most of your income and bolster your financial standing. Continuing to use your card heavily post-retirement could be setting you up for even more debt, however. My Retirement Paycheck explained that while you should always know the ins and outs of your credit agreement, you should make time to go over the fine print once you’ve entered retirement. Fees you may not have even noticed before could suddenly be taking a much larger toll on your income. The source also noted that it’s still important to pay your credit card bills on time every month, as even one slip-up later in life could have consequences for the rest of your financial situation.
Read up on filing for bankruptcy
Filing for bankruptcy is a scary concept for most people, especially those who were able to keep their finances stable throughout their working lives. While nobody wants to take this step, sometimes filing for bankruptcy can be your best option, explained the National Council on Aging. Before committing to this process, however, it’s important to be well-briefed on the facts. First, it’s vital to understand that filing for bankruptcy is a legal strategy that allows people struggling with money to restructure their financial plans and liquidate their debts. It’s not a simple process or one without consequences, which is why you should do plenty of research before making a decision around this topic. Your CFP should be able to help you decide if filing for bankruptcy is the right step for you.
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