How to Have Fun on a Fixed Income

She's in good company. According to the Bureau of Labor Statistics, about one in four people 55-plus volunteered in the year that ended in September 2011. Researchers have long held that volunteers involved with social and community activities enjoy better mental and physical health longer than other older adults.

As Gerstein sees it, volunteers also have more fun. Without that opportunity, she says, "I definitely would not be able to afford this lifestyle."

'The colleges make it stimulating'  

Margy and Richard Werling knew what they wanted in retirement: a rich offering of affordable cultural events, access to free or low-cost college-level classes, and an active lifestyle.

The couple achieved that last year when they moved from a Washington, D.C., suburb to the college town of Lexington, Va., home to Washington and Lee University and the Virginia Military Institute. "The two colleges make it a stimulating community," says Margy Werling, 73, who is taking a class in the arts of India. "You can audit classes, use the library and attend student performances."

Her calendar includes performances by an a cappella group from Venezuela, an orchestra from Germany and a chorus and dance company from Chicago.

Werling says she and her husband, 82, have become more budget-conscious since they began their retirement. They travel but they also enjoy visiting historic sites that are within driving distance, such as Thomas Jefferson's Monticello and Civil War sites in Charlottesville, Waynesboro and Roanoke.

"We constrain ourselves so we can extend what we have," she says. "If we don't spend this year, we can put it away for next year."

'We love dress rehearsals'  

The Wall Street slide snatched a portion of Steve McLaughlin's savings just as he was phasing into retirement. Fed up with the volatile stock market, McLaughlin, 61, decided to invest with a broker recommended by friends. That decision would cost him dearly and change the course of his financial future.

"All the money we gave him is gone," says McLaughlin, a lawyer who lives with his wife, DJ, 62, in San Diego. "We don't have much for retirement now."

McLaughlin says they both plan to retire and take early Social Security benefits within a year, which would replace their current annual income of about $33,000. After paying bills, there's not much left for entertainment, he says. They stopped dining out and seeing movies, instead renting releases from Netflix for $8 a month. He searches online for notices of free exhibitions. "We try to stay busy," he says.

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