5 Smart Steps To Retire On A Low Income

What if you could retire comfortably on a low income? In this episode of Low Income Rich Life, hosted by Kevin Bass, we go over five smart steps to retire on a low income. We uncover five essential strategies to ensure a secure and fulfilling retirement, even on a tight budget. We start with the critical importance of initiating a retirement savings account, focusing on employer-provided plans such as 401ks and Roth accounts. Kevin shares his personal experience and offers practical advice on maximizing these options to your advantage.

We then tackle the vital step of getting out of debt, drawing inspiration from financial experts like Dave Ramsey and Kevin's own journey. Reducing housing costs is another significant topic, with tips on managing mortgage expenses effectively. Throughout the episode, you'll find a mix of personal stories and actionable tips designed to guide you toward a brighter financial future. Whether you're just starting to plan or are close to retirement, join us to learn how to make the most out of your golden years without financial stress. Tune in and start taking steps today for a more secure tomorrow!

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Episode Transcript

Speaker 1 (00:00):
Today, we're going to look at five ways that you can
prepare yourself for retirementon a low income.
We will be discussing the fiveareas of your life that can make
or break your retirement plans,and by the end of this podcast,
you'll have a better idea ofthings that you can do today to
prepare for tomorrow, even ifyou're like me, as of Americans,
including myself, who live on alow to middle class income.

(00:23):
Let's get started.
Welcome to Low Income Rich Life, the podcast that helps you
prepare for a secure andfulfilling retirement, even on a
limited income.
I'm your host, kevin Bass.
Each week, we'll explorepractical tips and strategies
for getting out of debt,lowering expenses, living a

(00:44):
simpler life and finding truecontentment.
Whether you're nearingretirement or just starting to
plan, join me as we navigate thejourney to a brighter future.
Let's discover together how tomake the most of our golden
years without breaking the bank.
Obviously, the number one stepto retire on a low income has to

(01:11):
be saving for retirement.
If you're anything like me andstatistics say that most likely
you are you have very little inretirement savings.
I understand, I get it.
I'm there with you.
So the first thing you and Ican do is start a retirement
savings account.
What's the old saying?
When's the best time to plant atree?

(01:31):
10 years ago?
When's the second best time toplant a tree Today?
So if you haven't started aretirement savings account, do
it now, do it today.
I won't go into too much depthand detail about the various
retirement accounts Not today,because I have future podcasts
planned for diving deeper intothose individually.
I will say my advice is toprobably start with your

(01:53):
employer-provided retirementaccounts.
If they're available to you, besure to ask your HR
representatives about those andwhich ones you have.
As for myself, I personallyprefer to put my money into my
employer's 401k plan.
First, I put just enough intothe traditional 401k in order to
reach the max match, and ifyour employer offers a 401k

(02:15):
match, you want to be sure totake advantage of that.
First, my employer happens tooffer to match half of my
contribution up to 6%.
In other words, if I put in 6%,my employer puts in 3%.
After reaching my employer'smaximum match, I put the rest of
my paycheck deductions into.
Secondly, my Roth account and,last but not least, my health

(02:36):
savings account, or HSA.
I love my HSA.
I have an episode plannedthat's all about health savings
accounts and why I love them somuch.
So look for that.
Step number two should come asno surprise to any of us, and
that is getting out of debt.
If you've listened to DaveRamsey or any of the financial
advisors at least the good onesthey'll all suggest to get out

(02:58):
of debt and remain out of debt,and I understand that's a
struggle for all of us.
We unfortunately live in aculture that has taught us that
debt is the norm, and if we wantsomething, we shouldn't decide
whether or not we can afford it,but only can we figure out if
we can afford the payments.
I'm guilty myself.
Believe me, the problem withdebt right now in our life is
it's draining our resources.

(03:19):
We could be putting that moneytowards our retirement plan, and
then the issue with debt lateron in retirement is it will
obviously raise your cost ofliving, and the whole key to
living comfortably in retirementwith a low income is to keep
your cost of living low.
So what should we do to get outof debt?
I know it's easier said thandone.
I know it sucks.
Trust me, I'm going through theprocess right now myself.

(03:41):
It's not fun, but it needs tobe done.
Write down all your debt thatyou currently have and make a
plan.
Figure out how you can slowlyget out of debt.
There's plenty of informationon the net on how to do that.
Imagine if you added up all ofyour current payments that are
going towards your debt rightnow.
Next, imagine taking thatamount and putting it into a
retirement account.

(04:01):
That brings us to number threehousing.
Housing is the single largestexpense for most households and
it's really the key to makingyour retirement plans possible.
I know what you're thinking howin the world do I lower my
housing expenses?
Well, for starters, do you owea mortgage?
If so, can you have it paid offby the time you retire?
I hope so.
If you have a mortgage, I wouldstrongly suggest paying it off

(04:28):
one way or the other before youretire.
If you don't see a way that youcan pay off your mortgage by
retirement age, then maybe youcould downsize into a smaller
house or condo.
Maybe you sell your house, buya small piece of property in the
country and put maybe a usedmobile home on that property.
Or maybe you get a small pieceof land and you build a tiny
home, like my wife and I did.
It was a lot of work and tookus almost two years to do it,
but we were able to do it withno mortgage.

(04:49):
So now we own our property andhouse free and clear, with no
monthly mortgage payments.
It's just a small place in thecountry, just our little hole in
the world, and not really a bigdeal at all, but it's sure nice
not having mortgage payments.
The important thing, of course,is to reduce your housing
expense as low as you can andkeep it stable.
Please, please, don't rent inyour retirement, if you can help

(05:10):
it.
The costs are too unstable.
With rent prices going up everyyear, chances are they will
increase much faster than yourretirement income.
Go through all your bills, seewhat you can cut and do that now
.
It will not only get you readyto live on a lower income during
retirement, but it'll alsolower your bills now and help
you with number two on our list,which was getting out of debt.

(05:31):
Finally, we have number five onour list, which, well, it maybe
should have been number one.
It is definitely one of themost important parts of the plan
of retiring on a low income,and that is living on less.
Learning to live and be happywith less Money does not make
you happy.

(05:51):
Things do not make you happy.
Only you can make you happy.
So take a moment.
Think about your retirement,what it looks like.
What would make you happy inretirement?
What kind of things would youenjoy?
Maybe you won't be a worldtraveler, jet-setting across the
globe on exotic vacations, andmaybe you won't spend your days
of leisure sipping champagne andeating caviar in some country

(06:13):
club somewhere.
Maybe you just decide to spendtime doing things that you've
always wanted to do.
Maybe you have time to finallywrite that book that you've
always wanted to do.
Maybe you have time to finallywrite that book that you've
always wanted to write.
Then again, maybe you justwanted to read some books.
You could just simply want totake the grandbabies and go to
the zoo whenever you want.
It's the simple things in lifethat can make you the happiest.

(06:34):
There is plenty of life to belived that doesn't require a lot
of money, and hear this from meyour life will be no less
important or fulfilling ifyou're so.
Learn to live on less today,and you may just find out that
it's not only a better way tolive in retirement, but it might
be a better way to start livingtoday.

(06:56):
Thank you for joining us on thisepisode of Low Income Rich Life
.
I hope you found today's tipsand strategies helpful.
If you enjoyed the show, pleasesubscribe, rate and leave us a
review on your favorite podcastplatform.
Your feedback helps us reachmore listeners and improve the
content we bring to you.
Don't forget to visit ourwebsite at lowincomerichlifecom

(07:18):
for additional resources, shownotes and links to everything we
discussed today.
You can also join me on ourFacebook page for more updates
and retirement tips.
Remember, a truly rich life isnot about how you spend your
money, but how you spend yourtime.
I'm Kevin Bass, wishing you aprosperous and joyful retirement
journey.
Stay well and stay inspired Bye.