Women over 60 often find themselves facing some financial challenges, even as they approach retirement age. Our generation is often known as the “sandwich generation,” because we are often “sandwiched” between the conflicting and competing demands of helping our aging parents and also helping our grown children and grandchildren.

Many women over 60 have been giving generously to others throughout their lives – giving their time, their talents, and sometimes their money – but before we reach retirement age, it’s important to make sure that our own lives are on a sound financial footing.

According to this article in the New York Times, Americans over age 50 have an average of $8,278 in credit card debt, compared to an average balance of $6,258 for those under 50. Some of the leading causes of debt for Americans age 50 and over are medical bills, but nearly 25% of Americans age 50 or over said that they have given money to relatives or paid off the debt of relatives.

 
 

Credit cards aren’t the only form of debt that retirement-age Americans are often burdened with. According to a report from the Employment Benefit Research Institute, among Americans 75 or older, 24% were still paying off a mortgage or other housing loan in 2010.

Women over 60 know all too well how tempting it can be to help our family members in time of need. And it can be easy to fall into a pattern of spending slightly more than we earn – especially when life is busy and stressful, and we need to buy ourselves some added convenience or comfort.

But in order to have a happy, healthy, independent life in retirement, it’s important to get out of debt as soon as possible. Once we retire, our steady paycheck goes away and we need to live off of our accumulated life savings. It’s hard to do all of the things we want to do in retirement if we’re still paying off credit card bills.

Here are a few ideas for how women over 60 can get out of debt in retirement…

Re-evaluate Your Family Obligations

Are you sending monthly checks to your adult children, paying tuition for a grandchild, or otherwise financially supporting people in your family? Without meaning to sound harsh, perhaps it’s time to take a hard look at how much longer you can sustain these obligations. Sit down with your loved ones who are benefiting from your financial help, and help brainstorm some ideas for how else they can get the money they need, without having it come out of your bank account.

Track Your Expenses

Before you make a plan to get out of debt, it helps to find out exactly where all of your money is going. Use a free online tool like Mint.com to track your monthly spending, and then make adjustments accordingly. Chances are you can find an extra $100-$200 per month to re-direct toward paying off your debt.

Re-negotiate Your Fixed Costs

Every month, money comes out of your bank account to pay for car insurance, home insurance, health insurance and a variety of other “fixed expenses.” Try to save a few dollars by re-negotiating or adjusting your payments.

For example, you can shop around for savings on car insurance and home insurance using GEICO.com. If you are self-employed or retired, you can compare prices on health insurance plans (including Medicare supplemental plans) using eHealthInsurance.com.

Consider raising your deductibles on your home insurance and car insurance – you can often save money on your monthly premiums by agreeing to pay more out of pocket in the event of an accident or damage to your house.

Make a Plan

Figure out how much debt you have, and then make a plan for how to pay it off, one month at a time. Dave Ramsey is an American financial education expert who helps people get out of debt with his method called the “Debt Snowball.”

He encourages people to pay off their smallest debt first (while making minimum payments on all the other debts), and then working their way up, so that the momentum of paying off debts creates a powerful “snowball” effect.

There are different schools of thought on how to pay off credit card debt. Some financial experts recommend paying off the highest interest debt first, to save more money on interest payments. But whichever approach makes sense to you and will help you get out of debt is the “right” one to choose.

Make Extra Money

If you’re still working, the time is right to make extra money on the side by starting a small business, doing some consulting work, taking on a part-time job, freelancing, or otherwise “hustling” to get some extra cash coming in each month. Or if you’re already retired but feeling underutilized, it’s not too late to re-enter the workforce and start a new “second act” career. Here are a few ideas on unique work opportunities for women over 60.

Save Money While Paying Down Debt

While you’re paying off debt, it’s often encouraging and empowering to save a special pot of money at the same time. For example, you could set a goal saying, “As soon as this $5,000 credit card debt is paid off, I’m going to spend $1,000 on a nice vacation.” But instead of putting that $1,000 trip on your credit card, save up the money in a separate account – and then you can have the satisfaction of spending cash instead of racking up more debt.

SmartyPig.com is an online savings tool that helps you set up a high-interest online savings account and save money toward a specific goal – you can even share your progress on Facebook to keep people posted and hold yourself accountable.

Another online tool to help you stay accountable for reaching your financial goals is Stickk.com. This is a unique way to publicly declare a goal, set specific milestones to reach that goal, and hold yourself accountable – because Stickk forces you to commit to specific stakes. For example, you could declare that if you fail to reach your goal, you will donate some money to an organization or political candidate that you strongly oppose.

Being in debt is no fun, but it can be overcome with hard work, commitment and accountability. Remember the old saying, “Self discipline is giving up the thing you want now for the thing you want most.” Peace of mind and financial security is priceless – at any age.

What do you think about getting out of debt? Do you know any friends over 60 who are struggling with credit card debt or still paying off mortgages? Did you ever overcome some financial hardships in your life? How did you do it?

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Watch this video for 10 tips on how to save more money in retirement.

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