If you're like most Americans, you'll spend more of your life single than married. And like many, you may experience those single years while you're preparing for retirement and in retirement.
Whether you're part of a couple
or not, you still should save as much as you
can for retirement. The difference between
being part of a couple and being on your own
is not only a matter of accumulating enough
funds, but also of assembling adequate financial
safeguards to protect yourself from difficulties
such as unemployment and disabling illness.
As a single person, you're the
one in charge of saving for your retirement
and deciding how to spend those golden years.
There's a certain freedom in making those
decisions without having to consider anyone
else's wants or needs. But the caveat is that
you're responsible for assembling and maintaining
your own financial and emotional safety net,
because you can't automatically count on another
salary, retirement plan and caregiver as you
"When it comes to expenses
in retirement, a single person's will be about
the same as a couple's -- 90 percent to 100
percent of what they were pre-retirement,"
says Robert Pagliarini, CFP and author of
"The Six Day Financial Makeover: Transforming
Your Financial Life in Less Than a Week."
"There are certain costs, like utilities, property taxes and housing expenses, that are not much less if you are single than if you are in a couple," he says. "But on the savings side, the difference is likely to be substantial -- the single person doesn't have the benefit of someone else working and saving in a 401(k) plan."
If you haven't saved enough for retirement,
join the club. The Employee Benefit Research
Institute reports that roughly half of all
workers have saved less than $25,000. (See
Bankrate's story, "Status
of America's retirement" for the
gory details.) The average American lives
18 years in retirement and women generally
live longer than men.
Because of advances in health care, financial advisers are recommending that Americans save enough to provide for themselves through age 100 or even 110. That's the bad news; the good news is that as long as you've got income, it's not too late to start saving.
While the wake-up call for retirement savings comes later than it should
for Americans in general, single people usually
wait longer than married people to take retirement
saving seriously, says Bob Enright, a certified
financial planner with the Burton/Enright Group
in San Francisco. "Traditional financial
planning is all about making sure that you,
your spouse and kids are taken care of,"
he says. "When you are single, the focus
is drastically different. Single people tend
to feel more invincible because they haven't
had as much responsibility thrown their way
so they don't start saving until their 40s or
even their 50s."