Robin Zenger has saved diligently and lived within her means for her entire life. When she was in her forties, she began taking a serious look at her finances to set herself up for a secure retirement. That’s a smart strategy for anyone, but it’s particularly important for people like Zenger, who is single and has no children.
Aging presents uncertainties for everyone, but single, childless seniors are missing the backup that many people take for granted: a spouse or adult children who can step in when needed. Many of the usual basics of saving, investing and long-term financial planning apply to those aging without a life partner or adult children, but they also need special strategies for retirement saving, health care and estate planning.
Because of declining birth and marriage rates, caregiving family members will likely be in shorter supply for baby boomers and the generations that follow than in the past. Today, about half of American adults are married, a dramatic decrease from the 72% of adults who were married in 1960. In 2016, roughly 9% of those who were 50 or older had never married, according to the U.S. Census. And about one-third of baby boomers don’t have children. Still others will age alone for other reasons, including the death of a spouse, divorce, or children who are estranged or unable to help.
“Coming of age in the ’70s, I saw a lot of independent women and was keenly aware that I needed to be able to provide for myself,” says Zenger, 67, who is an adjunct history professor at the University of Arizona. Although she’s mostly optimistic about the years ahead, Zenger is still figuring out how she’ll navigate them without a built-in support system. Her strategy for this mammoth task? Live modestly, continue to work, invest, take good care of her health—and check in periodically with a financial adviser to make sure she’s still on track. She is also considering her options for housing if she can no longer live alone.
Build a team
For many people, the reality of aging alone becomes clear as they care for their parents and wonder who will be there to help them when they need it, says Joy Loverde, author of Who Will Take Care of Me When I’m Old?. Growing older without a significant other or adult kids means you’ll need to build a cast of supporting characters—including extended family, trusted friends and paid professionals—who can help with your finances, make medical decisions if you’re incapacitated and prevent you from becoming isolated as you age.
In addition to finding people who will manage your financial and medical affairs, you’ll probably need people to stop by, run errands or drive you to appointments. Many solo seniors branch out on the family tree, tapping siblings, nieces, nephews or cousins, while others add close friends to the mix. Zenger plans to rely on a longtime friend she has known since the two attended high school together in Panama. “She lives nearby and knows what I would do in various situations,” Zenger says.
Take the time to have a frank conversation with each of the people on your list, says Michael Branham, a certified financial planner at The Planning Center, in Moline, Ill. Find out what they’re willing to do, and outline your relevant plans or wishes. Revisit these plans often—particularly if you’re relying on siblings or friends who have their own health issues, or on younger family members who may move out of the area.
You’ll also need some professionals in your corner, particularly as you grow older. Start by finding a certified financial planner who can take a comprehensive approach, assess your finances, act as a sounding board and help you assemble and direct a team of other professionals. You can find advisers with the CFP credential at letsmakeaplan.org, or find a fee-only adviser at napfa.org. To find an adviser who has no asset or income minimum, visit Garrett Planning Network. For more help finding and vetting a financial planner, see kiplinger.com/links/advice.
To fill out your team, enlist the help of an estate-planning or elder-law attorney and perhaps a certified public accountant or enrolled agent to help with tax planning. A geriatric care manager can help with Medicare paperwork, monitor your medications and help you find a home health care aide or evaluate long-term-care facilities. If you don’t have a friend or family member in place to carry out your wishes and make legal, financial and health care decisions for you, consider working with a professional fiduciary, such as an accountant, lawyer or trust company officer.
Create an income safety net
If you’ve never had a partner or have been flying solo for years, you’re accustomed to living on one income. But many singles don’t have a strong enough backup plan to cover the costs of a major illness or other calamity.
Start by making sure you have enough cash on hand to cover emergencies, from a furnace that quits in the dead of winter to a job loss. While couples can generally aim to keep three to six months of living expenses in an emergency fund, many financial planners suggest that singles aim for a larger cushion, stashing between nine and 12 months of living expenses in a savings account. As you approach retirement, consider bulking up the account with at least two years of living expenses so that in the event of a market downturn, you won’t have to sell investments at a loss to pay the bills.
For singles who are still working, disability insurance is also more important than it is for those who are part of a couple, says Allison Alexander, a CFP with Savant Capital Management in Rockford, Ill. Many people have disability coverage through work, with premiums paid or heavily subsidized by their employer. That’s a start, but it’s rarely enough to meet your needs if an accident or illness keeps you from working. And if you’re out of work for a long period, you could end up depleting your retirement savings to cover living expenses.
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