At a time of skyrocketing consumer costs, even the most money-savvy seniors can find it difficult to scrape by—especially when they rely on a fixed monthly income. But budgeting can be a powerful tool in helping you comfortably cover everyday expenses and make your retirement income last longer.

These 10 practical budgeting tips for older adults can help you understand where your money goes, find ways to lower your costs, and create a monthly spending plan that works for you.

Will Social Security cover my retirement expenses?

Probably not, if you’re like most older adults. Social Security retirement benefits are only designed to replace about 40% of your working income (see our article, “How Much of My Income Will Social Security Replace?”).

UMass Boston’s Elder Index measures the income older adults need to live independently. According to the Elder Index interactive modeling tool, an older adult in excellent health who lives in the Baltimore area and pays a mortgage needs $3,365 per month to cover basic living expenses.¹

Now, consider that the average monthly Social Security check was $2,031.74 as of July 2026.² An older adult receiving the average payment would still need to come up with $1,333.26 monthly to make ends meet. 

Franklin faced this issue firsthand. Until recently, this 72-year-old Cleveland resident used multiple credit cards to make his purchases—not an unusual situation. But without a solid understanding of his expenses or how he planned to cover them, Franklin often found himself between a rock and a hard place: He had to use his entire Social Security check to pay his monthly bills, which meant he had nothing left over for daily needs like food, utilities, or gas for his car.

Franklin’s inability to make ends meet spiraled into a crisis that threatened not only his financial stability, but also his health and well-being. 

Eventually, the stress of it all led him to his local Department on Aging, where he asked for help.

A simple guide to budgeting: NCOA's Budget CheckUp

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Why is managing a budget a common challenge for older adults?

“Even with income from other sources, many older adults have very little left after paying their monthly expenses,” said Jessica Johnston, NCOA Senior Strategist for Economic Well-Being.

That’s why it’s important to understand the basics of money management and use practical strategies to reduce debt, build savings, and make your income go further," Johnston said.  

Happily, this is now the case for Franklin. Newly armed with practical money budgeting tips he learned in a financial literacy course, he is now working toward greater economic independence and a more secure future.

When you’re not working anymore, like Franklin, it’s important to make every penny count.

On average, you can expect Social Security to replace about 40% of your pre-retirement income. But this can vary based on your personal situation.

What are the best budgeting tips for seniors?

Using a budget calendar to track your spending can help you more easily visualize your monthly income and expenses. At the same time, there are a variety of steps you can take, strategies you can use, and resources you can tap to improve your financial well-being. Together, these can help you better weather today’s uncertainties—like when food prices rise; and enjoy tomorrow’s opportunities—like traveling to visit your grandchildren or friends.

“Even if you already follow a budget, finding ways to spend less can help your money go further,” Johnston said. “That doesn’t necessarily mean giving up the things you need or enjoy; it just means being more vigilant about where you spend.”

What are the best budgeting tips for seniors?

Below are some areas where you can reduce your expenses or make better use of the resources you already have. Review these options at least once every year.

1. Your insurance coverage and costs

Circumstances change, and your insurance plans and coverage may no longer be relevant. It’s easy to forget about your choices once you’ve made them, but that means you could be leaving money on the table.

How do I evaluate my insurance plans and costs?

☑️ Gather together your spending commitments: supplemental health insurance; prescription drug coverage; and life insurance and long-term care policies.

☑️ Determine whether you’re getting the best rates or have the most cost-effective plan(s).

☑️ Enlist help from a knowledgeable friend, family member, or professional to evaluate alternatives before you make any changes.

2. Your Medicare health insurance

You may be eligible to put $100 back into your monthly Social Security check. You could also save money on your premiums and co-pays.

How can I save money on Medicare costs?

☑️ Look into Medicare Savings Programs and learn whether you qualify.

☑️ Connect with your local State Health Insurance Assistance Program (SHIP). SHIPs offer free, unbiased Medicare counseling to beneficiaries and their families. Find your SHIP.

3. Your Medicare prescription drug coverage

Depending on your income, you could save money on your Part D premiums, deductibles, and co-pays.

How can I save money on prescription drugs?

☑️ Learn about the Part D Low Income Subsidy, also called Extra Help, and see if you’re eligible for help with your Medicare prescription costs.

☑️ Visit NCOA’s BenefitsCheckUp to apply for Extra Help online.

4. Your property taxes

Home values are rising across the country—and updated assessments can be a shock to your wallet. Many states offer a senior property tax exemption for residents who are 65 or older, which means you could save hundreds of dollars a year.

How can I save money on property taxes?

☑️  Visit NCOA’s BenefitsCheckUp to learn whether the senior property tax exemption program is available in your state and how to apply.

5. Your phone service

You could be paying more than you need. Depending on your income, you may be eligible for monthly discounts on your basic wireless or home telephone service through the government.

How can I save money on my cell phone bill?

☑️ Read about the FCC’s Lifeline program, which offers a monthly discount on phone or internet service to people with limited income.

☑️ Visit NCOA’s BenefitsCheckUp to see how you can apply.

6. Your desire and ability to give back

Do you have extra time on your hands? Your life and career experiences could potentially provide an extra source of income.

How can I earn extra income in retirement? 

☑️ Check into AmeriCorps Seniors RSVP opportunities in your area.

☑️ See if you can participate in the U.S. Department of Labor’s Senior Community Service Employment Program (SCSEP). Created in 1965, SCSEP is the nation’s oldest program to help low-income, unemployed people age 55+ find work.

7. Your home

Your house, if you own one, likely represents your greatest financial asset. Even though its value isn’t liquid, there may be ways for you to leverage equity so you can continue to live independently.

How can older adults access their home equity?

☑️ Read about how you can use your home to stay at home. NCOA's guide walks you through different options on how to tap your home equity, including reverse mortgages and home equity lines of credit.

☑️ Talk to a trusted financial professional to decide whether any of these options are right for you.

8. Your senior discounts

From national parks to locally owned stores, public transportation agencies to private entertainment venues, a variety of entities gratefully recognize your wisdom and contributions through reduced rates and prices.

How can I find senior discounts near me?

☑️ In most cases, simply ask whether there’s a senior citizen discount. You may be pleasantly surprised!

☑️ You can also check online directories like The Senior List. 

9. Your estate

Managing your money extends to how you’d like it distributed among your heirs, if you have them, or to charities you support. If you’re in a position to leave a financial legacy in any amount, it’s a good practice to communicate your wishes ahead of time.

How do I get started with estate planning?

☑️ Make a will. Learn more about setting up a will. 

☑️ Appoint a health care agent to make medical decisions for you when you’re unable to.

☑️ Designate a durable power of attorney to give someone else the authority to act on your behalf in certain matters.

☑️ Use NCOA’s partnership with FreeWill to get started.

☑️ Consult an attorney if your estate is complex.

 10. Your other benefits options

Millions of older adults miss out on saving money through public and private benefits programs simply because they don’t know about them, don’t believe they’re eligible, or aren’t sure how to apply. These programs can help you afford food, home energy costs, medicines, and more.

How can I save money on groceries, utilities, and prescriptions?

☑️ Visit NCOA’s BenefitsCheckUp to see what’s available in your area and how you can apply for money-saving benefits. Just enter your ZIP code to get started. It’s fast, free, and 100% confidential!

Sources

1. UMass Boston’s Elder Index. Found on the internet at https://elderindex.org/elder-index (Data in the example accessed on July 14, 2022).

2. Social Security Administration, “Effect of COLA on Average Social Security Benefits.” Found on the internet at https://www.ssa.gov/oact/cola/colaeffect.html