The Financial Perks of Getting Older
There's an upside to aging, from getting tax breaks to discounts at your favorite stores.
If you're age 50 or older, be prepared to start getting carded again. Many discounts, tax breaks and other perks for seniors start earlier than you think. Here are nine ways that getting older can help you keep a little more cash in your wallet.
1. Lower car insurance rates. Years of experience behind the wheel are a plus: Allstate cuts rates up to 10% for most drivers 55 and older. Geico and other insurers offer similar discounts if you take a driving class.
2. Beefed-up retirement savings. If you're 50 or older, you can make a "catch-up" contribution of $6,000 to your 401(k), for a total of up to $24,000 in 2016. You can also stash an extra $1,000 in an IRA, for an annual contribution of up to $6,500.
3. Deals on travel. American, Southwest and United airlines offer fliers 65 and older discounted fares on some domestic routes. Travelers 62 and older are eligible for 15% off some Amtrak fares and 5% off Greyhound bus tickets. Best Western trims 10% from its room rates if you're 55 or older, and Marriott cuts the price of your room by 15% if you’re at least 62. (Note: Don't jump at senior discounts without doing some comparison shopping first. You may be able to find a better price on your own. See Why Senior Travel Discounts Aren't Always the Best Deal.)
4. More for your HSA. If you're 55 or older, you can add an extra $1,000 to a health savings account in 2016. That's in addition to the $3,350 limit for individuals or $6,750 for families. You'll need an eligible high-deductible health insurance policy to qualify for an HSA.
5. Tax breaks from Uncle Sam. If you and your spouse are both 65, the standard deduction for 2016 is $15,100 (singles can claim a standard deduction of $7,850). And if you or your spouse is 65 or older, you can deduct eligible out-of-pocket medical expenses that exceed 7.5% of your adjusted gross income (rather than the 10% threshold for younger taxpayers).
6. Discounts galore. You can get discounts on everything from Kohl's shopping expeditions (15% off on Wednesdays for shoppers 55 and older) to Harris Teeter groceries (5% off on Thursdays if you're 60 or older). And AARP's $16-a-year membership for anyone 50 or older comes with a plethora of benefits, including discounts on hotels, restaurants and shopping. Members can also take advantage of a car-buying program and discounts on insurance coverage.
7. Cheaper tickets to ride. Some cities let older adults take public transit free or for a reduced fare. For example, riders 65 and older pay half price to take the subway in New York City, St. Louis and Washington, D.C.
8. A bargain on national parks. Nature lovers 62 and older can buy a lifetime pass from the U.S. National Park Service for access to more than 2,000 national parks and federal recreation areas. The senior pass costs $10 at federal recreation sites or $20 either by mail or online.
9. Free (or low-cost) classes. Many public colleges and some private universities allow seniors to audit classes free or at low tuition rates. The Osher Lifelong Learning Institute sponsors programs for people age 50 and older at 119 campuses. Membership generally costs about $200 to $600 per year.