No Pension. No 401(k). How to Get by on Social Security

Most people heading into retirement aren’t worried about what to do with all that free time — instead, they’re wondering how they’ll afford it. The Social Security Administration says about 21 percent of married couples and 43 percent of single seniors rely on Social Security for more than 90 percent of their income. Unfortunately, the benefits typically only replace about 40 percent of a worker’s pre-retirement earnings. Cheapism asked finance experts around the country for tips to help make ends meet on Social Security alone.

If your sole source of income during retirement will likely be Social Security, then begin by making sure you’re doing everything possible to maximize that benefit, says David Bakke of Money Crashers. “This might involve working longer than expected, especially if you’re earning good money later on in life,” suggests Bakke, who recommends trying to work until the age of 70 before taking benefits, which will result in a boost in the amount you ultimately receive each month. Normal retirement age is 67. But it’s possible to take Social Security benefits at 62, which will mean the amount you receive is greatly reduced because you’re drawing your benefits early.

As your retirement date draws closer, call the Social Security Administration to obtain specific details regarding your expected monthly payment so that you’re prepared. But perhaps more importantly, ask specific questions, says Dawn-Marie Joseph, founder of Estate Planning & Preservation. For instance “you might not know that you may be able to collect your deceased or ex-spouse’s monthly Social Security payment, which could ultimately be more than what your benefit would be,” explained Joseph.

For those whose only source of income during retirement is Social Security, another important step to take is reviewing and minimizing expenses. “It’s important to start with the highest impact expenses, such as home and car costs, then move down the list,” says Dustyn Ferguson, creator of DimeWillTell. https://dimewilltell.com/ “By focusing on high impact expenses first, you can see the real impact these expenses have on your retirement budget.”

There are more than 2,500 benefit programs nationwide designed to help lower income seniors with expenses related to housing, medication, healthcare and taxes, says Drew Kellerman of Phase 2 Wealth Advisors. But finding the programs can be daunting, so the National Council on Aging has created a non-profit website, BenefitsCheckUp, to help.

Seniors between age 65 and 74 spend about 32 percent of their household income on housing annually. Consider getting a roommate who can share the bills, or sell your house and move to a smaller place. “Not only will you see money back in your wallet by downsizing, but it also opens the choice of moving to a place that has lower costs of living,” says Dustyn Ferguson of DimeWillTell.

One of the most comprehensive ways to stretch your dollar is to move to a place with a lower cost of living, says Drew Kellerman of Phase 2 Wealth Advisors. “According to the Bureau of Labor Statistics, the annual cost of living in Birmingham, Alabama is $33,219, and the average price of a home in that city is $65,100, or about the same as a 10 percent down payment on the average single-family dwelling in parts of Seattle.”

There are many expenses associated with owning a car, among them maintenance, gas, and car insurance. “Car insurance isn't worth the cost if the car isn't being used much,” says Dustyn Ferguson of DimeWillTell. “Getting rid of the car entirely and using ride sharing services can actually be a big money saver.”

If you’re approaching retirement age with a mountain of credit card debt, make it a priority to eliminate those balances. “Get on a budget, reduce expenses, and send any financial surplus to your credit card balances,” says David Bakke of Money Crashers.

Many retirees who own their home outright are using the equity in their property to get by via reverse mortgages. “For the right person, this option can allow them to ‘cash out’ some of their home equity while staying in their home for the rest of their life,” says Drew Kellerman of Phase 2 Wealth Advisors.

Food pantries and other donation centers can be a lifesaver when living on a fixed income. Don’t overlook shopping at places like Salvation Army, Goodwill, and other second-hand stores says Dustyn Ferguson of DimeWillTell.

As soon as you're eligible, sign-up for Medicare, the federal health insurance program for people 65 and over. This will help reduce your out-of-pocket health insurance costs, says Dustyn Ferguson of DimeWill Tell. There are various Medicare programs covering hospital stays, doctor visits, and prescriptions.

Medicare doesn’t pay for all medical expenses. If you’re among those relying primarily on Social Security to get by, Medicaid may be able to help. It’s aimed at low-income retirees and was created to pay for things that Medicare does not cover. It even pays for such critical expenses as long-term care.

Get into the habit of inquiring about senior discounts wherever you go, says Dustyn Ferguson of DimeWillTell. You may be surprised by how many places offer them. Joining AARP once you turn 50 provides access to discounts on rental cars, hotel rooms, train and bus fares. In addition, countless stores offer discounts. Kohl’s provides a 15 percent senior discount every Wednesday. Many airlines also offer reduced prices for older travelers, including British Airways and United.

Yet another approach to trimming living expenses may be to find a group home, says Dock David Treece, a senior financial analyst with FitSmallBusiness. “By moving in with other adults you can significantly lower your cost of living, which will help you survive on social security.”

One approach to lowering your recurring monthly bills is to increase the deductibles on your health insurance. Higher deductibles typically translate into a lower monthly cost for insurance, says Dustyn Ferguson of DimeWillTell. This approach may not be for those making frequent visits to the doctor or other health professionals, however.

AMC Theatres offer a Senior Discount ticket for those 60 and older and this is just one example of ways to minimize your entertainment budget. Cinemark theaters host Senior Days that include discounted tickets. Ticketmaster also offers exclusive discounts to AARP members, such as two for one tickets, which allow for saving 50 percent when purchasing two tickets.

In some cities and states, utility companies offer discount programs for senior citizens. In Georgia seniors can receive a discount on gas and electric bills. The city of Seattle also offers eligible customers a 60 percent discount on their Seattle City Light bill and a 50 percent discount on their Seattle Public Utilities bill. The program is available for income-qualified residential households. Be sure to ask your utility provider about similar programs.

Some wireless phone providers also offer discounted plans for seniors. T-Mobile’s Unlimited 55+ provides customers who are 55 and older with two lines for just $35 per line with AutoPay. Sprint offers a similar program. Consumer Cellular offers AARP members a 5 percent discount on monthly fees and usage charges and a 30 percent discount on select accessories.

If budget cuts aren't enough, find a source of additional income. There are many ways to do this, some of which can be passive, such as a hobby that provides income, says Dustyn Ferguson of DimeWillTell. “Or there are more obvious ways, like a part time job. It's the last thing many people in retirement want to do, but not all sources of income have to be labor intensive or take a lot of time. Passive income sources are a huge win for people in retirement as they don't take up much time and can really make an impact in your income.”

While bringing in some additional money can be helpful, do your research first. Working while claiming Social Security benefits can result in your benefits being reduced if you pass certain thresholds, advises Dustyn Ferguson of DimeWillTell. “You'll need to balance the math out just right to prevent working from costing you, rather than helping you.”

One of the most popular choices for seniors who retire without a pension or other funds is to move in with their children, says Dock David Treece of FitSmallBusiness.com. “This isn’t an option for all retired seniors, but if you have adult children who live in your area and are willing to take you in, this is usually a cost-efficient option.”

For the more adventurous retirees, relocating abroad is yet another option that can help stretch a budget. “Many retirees who would barely get by on their modest income here in the U.S.A. have found that they can live at least a middle-class lifestyle on Social Security alone depending on where they choose to live,” says Drew Kellerman of Phase 2 Wealth Advisors, who suggests conducting thorough research and taking “test trips” before making the big move.

If you began tapping Social Security benefits early and regret that decision, all may not be lost. For up to 12 months after beginning benefits, it’s possible to withdraw your application. While this option requires repaying all the money already received, it allows something of a reset. You can continue growing your benefits until you want to file again.

Even after the 12-month mark has been eclipsed, there’s still one last way to slightly increase your Social Security benefits. When you turn 66, it’s possible to suspend the monthly payments, this time without having to pay the money back. For each year your payments are suspended up until age 70, you get retirement credit that increases your benefits by eight percent each year.