Anna is 67 years old and suddenly finds herself single due to the untimely death of her spouse. Anna and Bill met, fell in love, and started their life journey, hoping one day to enjoy their retirement traveling and bonding with grandchildren.
With that goal in mind, they spent 45 years navigating through life and saving for their retirement goals. Now Anna finds herself facing retirement alone.
Taking control of financial situations after losing a spouse may be overwhelming and scary, but it’s still possible to maintain a positive and healthy life; both emotionally and financially.
Give Yourself Time
Suddenly finding yourself living alone can be devastating and stressful. Though certain decisions need to be made quickly, not all choices have to be made immediately. Selling a house, changing ownership on bank accounts, and other items can wait. Giving yourself time to get used to your new lifestyle is important because life can still be enjoyable after the adjustment.
Offsetting Lower Lifetime Earning
Many people who find themselves alone after almost a lifetime in a partnership face financial challenges, including drops in income and being forced to manage money for possibly the first time. Women can be particularly at risk since women typically earn less during their lifetimes.
According to the Census Bureau, women are 10 percent less likely to work than men, with only 58 percent of women between the ages of 16 and 64 choosing to work. Also, women who do work earn almost $10,000 a year less than their male counterparts, at an average of $40,000 per year.
However, you can offset earning less in a lifetime by taking calculated risks with investments. Learning which accounts to draw from, as well as which accounts can afford higher risk, can extend your retirement savings and simultaneously provide a comfortable income.
Changing of Lifestyle
10.7 percent of women over the age of 65 are considered below poverty versus only 7.4 percent of men. Unfortunately, this is sometimes caused by attempting to live on a single income as you did while you were married. When a marriage ends, whether due to divorce or death, it’s necessary to re-evaluate your budget. Build a budget that includes premiums for health and long-term care insurance, then save as much as you can each month. Save monthly by tracking purchases and expenses in order to extend your retirement savings.
Additional opportunities, such as changing your housing situation, can provide a chance to save on monthly costs while opening new social environments. Building a strong network of friends in similar situations can provide you with chances to enjoy new opportunities while saving money.
Networking Beyond Social
Living as a single woman can be an amazing and exhilarating experience. One of the keys to thriving is to build a network system of family and friends who can support you in your goals.
The first step is to find a trusted person for financial support. You will need someone who is able to make financial decisions for you if you become unable to do it yourself. Many women will rely on their children or younger family members.
We have one client who has served as her mother’s “trusted person,” as she calls it, since her father passed away. Her mother added her name to all bank accounts to make access and management easier in the case of an emergency. Due to this planning, when her mother was hospitalized at the age of 92, she was able to easily step in to pay the bills and manage the accounts.
Another important aspect of a support network is to avoid falling prey to scams. The Better Business Bureau receives regular reports of fake insurance agents who tell widows their insurance premiums are delinquent and that they must pay for the release of funds. A team of trusted individuals, including a financial advisor, can protect your assets.
Planning for the Future
Retirement does not just involve planning to cover current expenses. Women live longer than men by approximately five years. Not only does this increase their chances of outliving their spouses and sometimes their financial resources, but longer lives can also spike overall expenses in medical and living costs.
This can easily be handled by purchasing long-term care insurance now. Though you may not plan on needing long-term care for the foreseeable future, purchasing insurance now will provide lower premiums and guaranteed coverage. You can then rest easy knowing your later years are covered in comfort.
Embracing the New You
There is a lot to be said about being 60 and single. In fact, the website Sixty and Me is devoted to the proposition that life is better for older single women. Currently, 37 percent of women over 65 live by themselves and are relishing single living.
While it will take time to get used to your new lifestyle and adjust to being single, it’s important to get out there and meet people who enjoy the same things, as you can help create a life you will enjoy. In addition to a strong social network and financial support system, taking control of your retirement planning and not relying on others for your savings can be empowering and freeing.
