Question: How differently, if at all, should I manage money during retirement and what types of budgeting techniques will be helpful?

Answer: Managing finances during retirement can be markedly different once a regular paycheck isn’t the principal source of income. Primarily because there won’t be increases from overtime, annual raises or the occasional promotion which permits deferring some major expenses to be paid back later as pay increases. So, managing money in retirement is different.

First, living on a perpetually fixed income, whether from pension and/or Social Security, requires having an exact handle on monthly income and expenses to make sure bills and living costs are covered. Your monthly budget should also make allowances for savings and, hopefully, investments, according to Yahoo Financial News.

Completely understanding where money goes and how that spending is divided between essential and discretionary purchases should be the foundation for a workable plan to meet both short- and long-term financial goals confidently.

Next, with a budget in place to help control spending, choose one discretionary expense category and set a goal to reduce spending there by 10 percent or more. By carefully managing optional spending, you can systematically increase savings or debt reduction, if needed.

Say you pick food as your category — consider cost-cutting measures such as clipping coupons or buying in bulk. Additionally, you might limit eating out and cook more at home, which can be made more cost efficient by planning meals ahead of time. Also consider skipping a few indulgences in favor of less expensive choices and limit impulse purchases at the grocery store. Be sure to keep track of your savings for future redirection.

For the next step, financial experts generally recommend keeping at least three months of living expenses on hand in cash savings. Heading into retirement, they suggest a goal of six or 12 months of expenses would be a good idea. This money should be separate from other retirement accounts such as 401(k)s, 403(b)s, pension plans or IRAs.

When a paycheck is your main income, using credit cards or other unsecured loans for emergencies and/or large purchases can be more easily integrated into monthly spending. However in retirement, without the potential of future raises for additional income to pay down debt, it might be better to have cash on hand to cover unexpected expenses.

After controlling spending and providing for emergency money, the next financial habit to develop is paying off credit card debt. The conventional approach, normally recommended by financial planners, is to concentrate on paying off the highest annual percentage rate card first while making minimum payments on other accounts. Once the first account is paid off, redirect that monthly payment to the remaining accounts starting with the next highest APR, suggests

Alternatively, consider consolidating credit card balances to a lower rate perhaps with a home equity line of credit or a zero percent balance transfer offer. By lowering the APR, you can expedite repayment. Just make sure not to use paid-off cards and maintain spending discipline so balances don’t accumulate again.

Money management in retirement requires developing the right skills include creating and adhering to a budget; controlling spending; saving cash for a rainy day; and, eliminating revolving debt.

Since retirement can last for decades, managing your money likely will need to occur in stages, starting early with careful and consistent saving during your working career. The next phase is structuring retirement savings to provide lasting and predictable income once you stop working. Then strategic budgeting and management in retirement to make sure your money is being put to its highest and best use.

Good money management skills are needed before you retire, but definitely once you retire.

Michael Bateman is a retiree who previously worked in marketing and corporate communications.