How Singles Should Plan Differently Than Couples for Retirement

4 Ways Retirement Planning for Singles Is Easier

Single woman by car.
Some retirement planning choices are easier as a single. Cultura/Jag Images/Getty Images

The great news about being single as you enter retirement is that your retirement planning is typically far less complex than comparable planning for couples. You need to think in terms of your life expectancy and income needs and can do so without worry about how your choices affect a partner.

Here are four retirement planning decisions that singles will want to look at in a different way than couples will.

1. Look at Life Only Annuities and Pension Options

If you are lucky enough to have a pension available to you, first you have to decide if you want to take a lump sum or annuity. The longer you think you might live, the more sense the annuity choice will usually make.

If the annuity choice is right for you consider the single life-only option. This option provides maximum income to you. You might also consider an immediate annuity with a life-only option. These aren’t great choices for couples as the insurance companies pay out less if they have to cover a joint life expectancy. But singles can take advantage of the higher life-only payout options that are available.

2. Consider Long Term Care Insurance

Many couples rely on each other for caregiving later in life. As a single, you may want the security of knowing you have insurance coverage in place to help cover caregiving costs. You are far more likely to seek out the care you need if you have a long-term care policy in place to help cover the expense.

They aren’t cheap, but they do bring the security of knowing that you won’t be stressed about covering later-life health care needs that may arise.

3. Social Security Claiming Is Simpler

If you are a single with no previous marriages that lasted 10 years or more then your Social Security claiming choices are fairly simple.

You’ll get far more by waiting until 70 to claim. For most singles, it will only make sense to claim earlier if you have reason to believe your life expectancy is shorter than average.

If you do claim before you reach your full retirement age and you continue to work, watch out for the Social Security earnings limit; you could end up owing money back if you make too much. Once you are past full retirement age the earnings limit no longer applies.

If you are single and have a previous marriage that was ten years or longer your Social Security choices are a bit more complex. You may be able to claim a spousal benefit based on your ex’s earnings record, and later switch over to your own benefit amount. If you have a deceased ex-spouse you may be eligible for a widow/widower benefit based on their earnings record. Examine all your choices before you claim.

4. Explore Alternate Lifestyles

As a single, you can head out on a new adventure anytime. Ever thought about life overseas? Take a look at how much retirement abroad may cost; you might be surprised to find some very affordable options. What about life on the road traveling RV style in retirement? You can find groups to travel with for friendship and fun.

You could also rent a room out in your home to bring in some extra income or travel by staying in other people’s homes. Or maybe you just want to move to a different state. In some states, retirees pay far lesser taxes than in others. These are all decisions that are easier to make as a single.

Anything is possible, so don’t hold back. Start planning your retirement journey.