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How to live comfortably on a fixed income

26 Mar 2025

Living on a fixed income in retirement can be challenging, especially with the rising cost of living. However, with careful planning and smart strategies, you can maintain a comfortable and fulfilling lifestyle without financial stress. Here’s how!

 

1. Budgeting for peace of mind

A well-structured budget is key to making the most of your income. Start by listing all your sources of income, such as the age pension, superannuation and any investments. Then track your essential expenses – rent or mortgage, utilities, groceries and healthcare – before allocating money for leisure and discretionary spending. Using budgeting tools like the Moneysmart Budget Planner (offered by ASIC) can help you stay on top of your finances. 

2. Making the most of concessions and discounts

Australia offers a range of benefits for seniors to help reduce living costs. If you have a Seniors Card, you’re entitled to discounts on public transport, utilities, healthcare and more. The Commonwealth Seniors Health Card and the Pensioner Concession Card also provide access to cheaper medicines and medical services. Check with your local government for available benefits. 

3. Cutting costs without sacrificing quality

Savvy spending can make a significant difference to your quality of life. Consider:

  • Downsizing: If maintaining a large home is costly, moving to a smaller property can reduce expenses and free up cash.
  • Energy efficiency: Switch to LED lighting, compare electricity providers, and take advantage of government rebates on energy-saving appliances.
  • Meal planning: Cooking at home and buying in bulk can save money while still allowing for healthy, delicious meals. 

4. Boosting your Income

Even on a fixed income, there are ways to supplement your earnings:

  • Part-time work or freelancing: Many seniors enjoy casual jobs, tutoring or remote work.
  • Renting out a spare room: Platforms like Airbnb or long-term rentals can provide extra income.
  • Selling unused items: Decluttering and selling things online or at local markets can bring in additional cash. 

5. Staying financially informed

Keeping up with financial news and seeking professional advice can help you manage your money wisely. Free financial counselling services, such as those offered by the National Debt Helpline (1800 007 007), can provide support if you’re facing financial difficulties.

With mindful planning and the right resources, living on a fixed income doesn’t have to mean cutting back on enjoyment. By making smart financial choices, you can lead a comfortable and fulfilling life well into retirement.