When thinking about retirement, it’s common for couples to want to retire together, or at least within a few years of each other. This could be because they are at similar stages of their careers, or because one spouse doesn’t want to keep working while watching their partner relax and have fun! Conversations about retirement are important for any couple, but there are different considerations for partners with a large age gap.
As an older spouse is getting ready to slow down professionally, a younger spouse may be just reaching the peak of their career. This can create tension between competing priorities. One partner may be ready to travel and have unstructured time together, while the other may not be ready to think about retiring for another ten years or more.
Even as both partners may want to inhabit the same life stages, it’s a fact that the younger partner is likely to live longer – potentially decades longer – than their spouse. This creates the dual challenge of enjoying earlier years together while ensuring financial flexibility during both partners’ later years.
Long-Term Financial Consideration
Any long-term plan for a couple with a significant age gap must account for a longer period of retirement. Planning for 20 or even 30 years might not be enough. For example, if a younger spouse retires early to align with their partner’s timeline, their retirement years could be longer than their entire working career. Beyond standard planning considerations, pension and healthcare decisions can look different for couples with a large age gap.
Pensions provide a stream of income for the life of the person who accrued it, with the possibility of continuing for a surviving beneficiary. Depending on the relative ages of the recipient and the beneficiary, the stream of income will be modified. Even though it reduces current monthly income, a higher survivorship percentage may be more appropriate for an older recipient, because the income stream to their spouse could continue for many years after they pass. Conversely, it may be more valuable for a younger recipient to maximize their own current benefit, accepting the risk that, if they die early, their spouse’s income could drop. Deciding when to claim Social Security benefits has similar considerations, as surviving spouses can claim survivor’s benefits under certain circumstances. Incorporating these factors into long-term planning enables decisions to be made today that increase flexibility down the road.
Health insurance is another crucial element, particularly for a younger spouse who is considering early retirement. While their partner may be at or near Medicare age, an early retiree needs to have a plan for their own health insurance until they reach age 65, especially if they are still covering children under their insurance. Typically, that means getting a plan through a healthcare exchange or a broker, or directly with an insurer. This can be very expensive, and it could be a reason for some people to work longer.
Planning for the Later Years
Many people experience some kind of long-term care need as they get older, even when it doesn’t rise to the level of needing professional support. For example, getting groceries involves driving, walking around the store, and carrying heavy bags to and from the car. There are plenty of ways to make each of these physical tasks easier, but at some point, it can make sense to have someone else who can help.
One of the features of an age-gap couple is that the younger spouse is likely to maintain their strength and mobility longer than their partner. This means the younger spouse can take more responsibility for the physical tasks of day-to-day life. Just because they can, however, doesn’t mean that it should be the default plan.
It’s important to think about how both spouses envision their lives as they age, including any long-term support they may need. Caring for an older partner can be physically and emotionally difficult, and it can crowd out opportunities for the younger partner to live their own life while they’re still able. These considerations also factor into longer-term housing plans. For some couples, an age gap makes it easier to stay in their home longer, while others may choose to move to a retirement community that provides community and care. When it accounts for the needs of both partners, thoughtful planning is an act of love.
Planning For Your Own Timeline
Planning for retirement involves numerous considerations, from timing to financial impacts to envisioning your next chapters. For couples who have a large age gap, standard retirement advice does not always apply. This doesn’t mean that age-gap couples need a complex plan. They simply need one that’s built around their own timelines.
Through thoughtful exploration, the transition to retirement can be both resilient and rewarding no matter one’s age. Acknowledging the challenges facing spouses of different ages is an important step toward building a plan that meets everyone’s needs.
