Retirement often means relying on a fixed income, making careful budgeting essential.
Many retirees need to cut back on expenses to make ends meet. Financial expert Suze Orman, a leading voice in personal finance, suggests one specific area where retirees should consider reducing spending.
“That expense is eating out,” Orman told GOBankingRates.
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Orman stressed distinguishing between essential needs and discretionary wants, particularly for retirees.
“For you to have money, you have to learn to live below your means but within your needs,” Orman said. “How do you do that? You do that by simply purchasing needs versus wants. What is a need? Need is food that you buy at a grocery store. What is a want? A want is going out to eat at a restaurant and doing it over and over again.”
Orman advocates for cutting back or eliminating dining out to save money for everyone, not just retirees. She highlights that eating out is many people’s primary cause of credit card debt.
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She recalled appearing on “The Oprah Winfrey Show” in 2010 and advising viewers who want to save money to try not eating out for six months.
“The restaurant industry went absolutely bazooey,” Orman said. “But after that, do you know how many people write in, and they said to me, ‘Oh my God, Suze, we’ve saved so much money’? I can’t even tell you.”
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Despite having the financial means to dine out regularly, Orman adheres to her advice by limiting her restaurant expenses.
“I myself am a very, very wealthy woman, and the very last thing I would think about doing is going out to eat,” she said.
Many people have already limited their dining-out experiences due to the pandemic. According to “Shark Tank” star Kevin O’Leary, people are ordering meals to be delivered, and more are working remotely or on a hybrid schedule, so office lunch outings are a thing of the past.
Inflation also forces people to cut back on extras, including dining out.
“The U.S. restaurant industry finds itself on the menu,” O’Leary wrote in a column for the Daily Mail. “In this economy, an ‘upscale McDonald’s’ is a luxury that many can’t afford.”
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