In the “Leave it to Beaver” era nobody would have guessed that by 2010 something like 13 million people over the age of 40 would not ever have been married. Nor could they have imagined the astonishing number of single people in the country due to divorce. When we see ads that promote making plans for retirement, it’s all about the smiling faces of happily retired couples. It makes you think being single and happily retired is taboo.
Financial planners cannot ignore the number of retiring singles any more than they can ignore issues such as the threat of dwindling social security funds that affect the couples they serve.
Single men and women can’t put the blinders on either. By the time they reach retirement age, couples are finding it tougher than ever to save even as little as $50,000 with both partners contributing. Where does that leave single people?
When you are 50, single and have no retirement plan, prospects can be a little scary. It may not be feasible for you to work longer than the traditional retirement age, and if you have not planned you may find yourself in a very uncomfortable position. And really, who want to spend their entire life waking up each morning just to go to work?
Relying on Social Security does not cut it any longer. On top of this, being single means you don’t have the benefit of a spouse’s income to fall back on. There are a few things you can do right now to plan for your future. The first is to visit the Social Security website and calculate how much money you are entitled to receive at various retirement dates. That will help you to determine when it is the best time to start your benefits; this may be a year or two after you turn 65.
If you don’t have disability insurance, get it now. If you are employed, likely you have coverage, although not every state requires an employer to offer more than short-term disability coverage. Being self-employed means that you must provide it for yourself, so do it. The monthly cost depends on your age and health. It may be an added expense you prefer not to have but if you are injured or become ill you will need it. You also need long-term care insurance, especially in view of the fact you don’t have a partner to take care of you. Your monthly costs are lower if you enroll in these insurance plans sooner than later.
Make an appointment to meet with an estate planner to establish who will have the power of attorney over your personal and business matters if you become unable to make coherent decisions. You need a living will to legally establish your wishes. You also need a will to state how you want your estate handled after your death.
Find out if you have assets for which you are entitled. These include pension plans from previous employers, shares in company stock, group life insurance, 401 (k) programs or benefits form a former spouse’s pension. The amounts may not be substantial but every little bit counts.
Economic down times can be disastrous for people that have depended on jobs all their lives, but for anyone willing to tap into their entrepreneurial side, the times have opened up opportunities for starting a small business. The Small Business Administration is a fantastic resource if you have a business idea with merit.
Consider also the ways you can offset one your biggest living expenses – the cost of housing. If you have been renting or leasing, it could be far more profitable for example, to own a home that creates monthly residual income. There are millions of dollars available in assistance through the state housing authorities that could make a difference in your owning a home.
You do not need to suffer any financial restrictions because you are single when you retire, and it is not too late to start planning for single retirement now. Take action and remember that one door opened leads to another.