According to estimates, the average senior citizen in the U.S. holds nearly $83,000 in debt – this includes items such as home mortgages, car loans, credit cards, and even health care costs. Not only has this thrown the retirement plans of millions of Americans into disarray but the cost of paying off the debt also eats into what savings they have left.

Combined this can lead to a sense of anxiety over money, which can impact one’s ability to enjoy their retirement. But, if you are about to retire (or are already retired) and are dealing with debt-related stress, then here are some tips on how seniors can overcome debt and enjoy retirement.

Grayscale Photography of Man Holding Cane Walker

Back to Basics – Get a Budget

This is financial planning 101, as the first thing you want to do is put together a budget. Doing so will help you to better track your income and your expenses and this will lead to a better understanding of your personal financial position.  In this way, you can make better decisions about where and how to cut back if needed.

In addition, having a budget in place will allow you to “what if” your finances by asking what would happen if you paid off all your debt now, or took a longer-term approach.  Regardless, of your decision, the key will be the ability to see how your choice will impact your cash flow both on a month-to-month basis and over time.

This is important as we are living longer, and this can only mean one thing – you will need more money than you ever thought you needed for retirement. As such, get a budget and start to take back control of your finances.

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Get Rid of (Almost All) Your Credit Cards

Credit cards are addictive as those little pieces of plastic can buy almost anything. The only downside with an addiction is that you eventually come down from the high and this usually coincides with when your bill arrives.

While you probably don’t want to get rid of all your credit cards, those with high-interest rates or expensive annual fees should be the first to go. From there, you will want to pare back your credit card collection to one or two cards max and then you want to put these cards in a safe place and only use them in case of an emergency.

In this way, you will be able to get yourself out of the trap of spending money you don’t have today. This will lead to the fiscal restraint needed to get you out of debt and start enjoying your retirement.

By the way, don’t take this for granted as failing to cut back spending habits after retirement can get even the most conservative spenders into trouble.  The reason is simple, you have grown accustomed to living at a certain income level for the year.

But unless your retirement plan is robust enough to match your pre-retirement income dollar for dollar, then you will have to realize that your post-retirement income is lower, and this means that you will need to cut back your spending. As such, get rid of the credit cards now so that you won’t get into trouble later.

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Put Your Assets to Work

You’ve worked hard most of your life and now it is your time to relax as such you want to flip the script and put your money to work for you. This starts by working with your financial planner to determine the ideal investment strategy based on your circumstances – one of which is your debt level.

In addition, you might want to look at ways to leverage the equity value you’ve built up in your home to not only get rid of your debt but to bolster your retirement portfolio. This could include looking into a reverse mortgage as it would allow you to effectively freeze your mortgage payment.

Not only would this free up cash that could be used to pay down other debt, but it will also give you a chance to put your assets to work for a better cause – you and your retirement.  If this is something that interests you, then you might want to check out

Don’t let being debt ruin your retirement plans. Instead, start with a budget, get rid of your credit cards, and put your assets to work for you.