Want to Cut Costs in Retirement? Here Are 8 Ways to Lower Your Expenses

Rising costs are a stressor for Americans of all ages. But for retirees — many of whom are on fixed income — the pain of increasing prices is particularly acute.

While Social Security benefits get an annual bump to help keep up with inflation, most retirees still regularly trim their spending to protect their nest eggs over the long-haul.

For many workers nearing retirement age, cost-cutting won’t be as much a strategic personal finance move as it will be a necessity. Nearly two-thirds of Americans are more concerned about running out of money in retirement than they are about dying, according to an annual retirement study from the Allianz Center for the Future of Retirement.

Here’s how you can cut costs — both big and small — to help shore up your retirement budget.

Rethink your housing

Housing affordability is an issue that affects all age groups. But for older Americans looking to cut their living expenses, tapping into your home’s equity could be a pathway to financial stability.

Real estate has long been a primary retirement funding tool. But the usefulness of so-called housing wealth has continued to increase alongside home prices. One popular index finds that home values have risen nearly 600% since 1980, and the average home sale price is now $512,800, according to the Federal Reserve Bank of St. Louis.

Retirees who own their homes and are looking to cut expenses should consider taking advantage of the current housing market by downsizing, moving to an area with lower living expenses or a combination of the two.

1. Downsize your home

The average American home measures around 2,300 square feet and all that living space can present challenges for those attempting to age in place. There are the financial burdens, such as increasing property taxes, skyrocketing homeowners insurance premiums and higher utility bills, as well as lifestyle stressors like mobility issues and general upkeep.

Forty-four percent of 60- to 70-year-old homeowners are carrying mortgages into retirement, according to financial services company TIAA. If that group includes you, the savings from downsizing are obvious: Selling your home and using the proceeds to buy a smaller, more affordable property allows you to offload (or at least, significantly lower) your monthly mortgage payments.

But even if you own your home outright, selling it and moving to a smaller property can still result in tremendous savings. Your utility bills and property taxes will shrink. And with Rocket Mortgage reporting that the median listing price per square foot is $233, downsizing from that average 2,300-square-foot home to a more reasonable 1,000-square-foot home could gross over $300,000 for retirees.

2. Relocate to a lower cost of living area

Selling your home at a time when prices are near record highs can have additional benefits when coupled with moving to a lower cost of living area. Florida is often idealized as America’s retirement hotspot with 1,350 miles of coastline, an average temperature of 72 degrees and, crucially for your budget, no income tax.

But the Sunshine State isn’t a slam dunk for retirees anymore. Florida's property taxes have been rising, its homeowners insurance policies are the highest in the nation and properties subject to homeowners associations are increasingly unaffordable due to ongoing assessment fees.

Instead, you may want to consider more affordable housing markets that aren’t known as retiree locales. Places like Syracuse, New York; Akron, Ohio; Augusta, Georgia; and Pittsburgh made Zillow’s list of most affordable housing markets this year and also offer an array of recreational activities. All of them have typical home values that are about 40% lower than the national average, according to Zillow.

Housing is the main driver of the overall cost of living in a particular region, but local taxes, groceries and healthcare all play a role, too. You should map out typical spending on those essentials before relocating.

Take advantage of senior discounts

If your monthly bills are steadily increasing, you’re not alone. Prices for everything from electricity to car insurance to streaming services are on the rise, which can put pressure on retirees' budgets.

Aside from necessities like electricity, water and food, older Americans should routinely revisit their household budgets to identify ways to lower recurring costs. Before making any drastic cuts, look for senior discounts, which can apply to both discretionary spending and consumer staples. Here are a few common categories.

3. Mobile phone plans for seniors

The average monthly cell phone bill was $141 was last year, according to JD Power, which makes for a significant line item in retirement budgets. You might be able to shrink that line by changing to a lower-cost mobile virtual network operator, or MVNO.

MVNOs offer services under their brand names but operate on other company’s networks, meaning they don’t have to shell out for network growth or maintenance. So companies in this space — like Cricket Wireless, Mint Mobile and Boost Mobile — are able to offer lower-priced plans than their major carrier competitors like AT&T, Verizon and T-Mobile. (Learn more about these plans with Money’s list of best cheap cell phone plans.)

The other approach to lowering your monthly cell phone bill is to research companies offering senior discounts. AT&T, for example, offers senior plans for residents of Florida ages 55 and older that include unlimited talk, text and data for a monthly cost of $40 per line, or $35 per line for two.

Lively from Best Buy offers cell phones and mobile medical alert systems with affordable plans for seniors. Its basic plan for seniors starts at $14.99 per month. For $44.99 per month, its premium plan includes features like an assistant that can schedule Lyft rides without requiring the app on your phone, urgent response, on-call nurses and Lively Link, which alerts friends and family members if there’s an emergency.

4. Discounts for streaming services

Streaming services won't stop raising their prices. HBO Max recently increased their prices for the third year in a row. Apple TV, Peacock and Netflix increased their prices this year as well, and Paramount Plus is slated to hike its prices in early 2026, The Verge reported.

Overall, streaming prices have doubled in the past decade, according to Quartz. Additionally, Americans are paying for more individual services as more media companies have launched their own. More than half of households reported paying for four or more streaming services, according to Consumer Reports.

The good news is that several services are now offered in bundles, like Xfinity’s StreamSaver + Internet, which includes access to Apple TV+, Peacock Premium with ads and Netflix Standard with ads for $15 per month (increases to $18 per month in late December). You may also be able to trim your monthly costs by switching to a lower-tier, ad-supported plan. You can save $204 a year on Netflix, for example, by switching from its premium plan to its standard ad plan. Finally, with so many services attracting customers with original content, you can save some cash by simply signing up and canceling services as you want to watch particular shows.

5. Travel deals for seniors

One of the best parts of retirement is embracing the ability to travel more. But travel, like most other facets of life, is getting more expensive. According to the U.S. Travel Association's Travel Price Index, which measures changes in the cost of travel on a seasonally-adjusted basis, the cost of lodging increased 10% from September 2019 to September 2025, while transportation (e.g. airfare, fuel, intercity transportation) increased 12%.

The silver lining: Senior discounts can help offset many of these increases. For seafaring fans, Carnival Cruise Line offers those 55 and up its Senior Special, and MSC Cruises offers those 65 and older up to a 10% discount on all of its cruises. Additionally, several cruise lines offer discounted rates for AARP members.

When it comes to rental cars, AARP members can again take advantage. Membership provides discounts of up to 35% for major rental companies, including Expedia, Avis and Budget.

The same goes for lodging, with AARP members eligible for discounts at hotel chains, including Best Western, Days Inn, La Quinta, Radisson, Wyndham and dozens of others.

6. Save on pharmacies and groceries

Retirees can also take advantage of senior discounts for everyday purchases like pharmacy items and food staples.

Walgreens’ Seniors Days, for example, are held in-store on the first Tuesday of every month or online for extended periods. Members of myWalgreens who are 55 and up can snag 20% off eligible items during these days.

Over the past year, food inflation has outpaced overall inflation, according to the Consumer Price Index. However, major supermarket chains routinely provide senior discounts, which can help offset the elevated cost of groceries. Fred Meyer, a Kroger subsidiary with locations in four Western states, gives those ages 55 and older an additional 10% off the first Tuesday of each month. Shoppers on the East Coast, meanwhile, can use Harris Teeter’s Club 60 Senior Discount, which provides a 5% discount to those 60 and older every Thursday.

Shop around for better insurance

Although only a few major insurance providers offer senior discounts, there are ways to find more affordable plans. This is important as rates for some insurance products tend to increase with age.

Finding a way to reduce your insurance costs can help offset other — and often more pressing — monthly expenses, like healthcare, housing or groceries.

7. Senior discounts for auto insurance

It’s smart practice to shop for auto insurance quotes at least once a year, experts recommend. That’s especially true if your driving habits have changed, you need different coverage or you swap to a more affordable car — all of which can result in a lower car insurance premium.

Beyond shopping around, several companies offer discounts to older drivers.

Farmers Insurance, for example, offers a mature driver discount for those over the age of 55 who have completed a state-approved safe driver training in the last three years. Geico policyholders ages 50 and older can qualify for a discount if they meet certain conditions, including not having any traffic violations or accidents in the past five years. And Nationwide offers a defensive driving discount to drivers 55 and older in select states who complete an accident prevention course and don’t have an at-fault accident on their record for the past 35 months.

8. Bundling your insurance

Another way to save money on your insurance is by bundling your policies. The savings will vary by company, but multi-policy deals often result in a discount of 10% to 25% off the policy premium, which can translate to considerable savings.

Liberty Mutual offers savings up to $950 per year when you bundle your home and auto insurance. State Farm allows those who bundle home and auto policies to save more than $1,300. And bundling home and auto insurance online with Allstate can save policyholders up to 25%.

Be prepared for prices to keep climbing

As costs continue to rise, retirees or those nearing retirement will always face the prospect of diminished purchasing power on fixed income. Understanding that risk is the first step in overcoming it.

Routinely revisit your household budget to understand where — and by how much — expenses can be cut. Negotiate your bills regularly and take the time to research the best deals available for seniors. Remember that with some planning, retirees can enjoy years of financial stability despite rising costs.

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