Retirement Planning for Couples with an Age Difference

When it comes to retirement planning, every couple’s journey is unique. However, for couples with a significant age difference, the process often involves additional layers of complexity. From differing retirement timelines to unique financial and health care needs, there is plenty to consider. With the right strategies and a proactive approach, you can create a retirement plan that works for both of you. Here are a few points to navigate retirement planning as an age-gap couple.

Align on Shared Retirement Goals

The first step in planning is open communication. What does retirement look like for each of you?

• Does one partner want to retire earlier while the other keeps working?
• How do you envision spending your retirement years—traveling, pursuing hobbies, or settling into a quieter lifestyle?

Having these discussions early ensures you’re building a plan that reflects both individual goals and priorities.

Strategize for Staggered Retirements

When there is an age difference, it’s common for one partner to retire before the other. This requires careful coordination.

• Managing Income Gaps: If one partner retires first, determine how you’ll cover living expenses. This might involve relying on savings, part-time work, or other income sources until benefits like Social Security kick in.
• Phased Retirement: The older partner might consider transitioning to part-time work instead of fully retiring, maintaining cash flow and possibly health care benefits.

Staggered retirements can provide financial advantages but require a holistic plan.

Optimize Social Security Timing

Social Security is an important part of retirement income for most couples. For age-gap couples, timing can significantly impact long-term benefits.

• Delaying Benefits: The older partner may want to delay claiming Social Security to maximize monthly payments, especially if they anticipate outliving their spouse.
• Spousal and Survivor Benefits: A higher benefit for one spouse often translates into better survivor benefits for the younger partner.

Carefully evaluate when to start taking benefits to maximize long-term payouts for both partners.

Plan for Health Care Costs

Health care is one of the largest retirement expenses, and age-gap couples face unique challenges.

• Medicare Eligibility: The older spouse may qualify for Medicare before the younger one, requiring additional coverage for the younger partner.
• Bridging the Gap: Private health insurance may be needed until both partners qualify for Medicare, so factor these costs into your budget.
• Long-Term Care Planning: Discuss potential scenarios where one partner may require care significantly earlier than the other.

Proactively addressing health care needs ensures you are prepared for potential gaps and unexpected expenses.

Adjust Your Investment Strategy

For age-gap couples, investment strategies need to support two distinct time horizons.

• Older Partner’s Portfolio: Focus on preserving capital and generating income, particularly if retirement is near.
• Younger Partner’s Portfolio: With a longer runway, a growth-oriented approach can support future needs.

Together, these strategies create balance—addressing immediate needs while supporting long-term goals.

Why Estate Planning is So Important

An age difference often means one partner is likely to outlive the other. Planning for this ensures the surviving partner is financially secure.

• Longevity Planning: Consider inflation, health care costs, and income needs for the younger spouse, who may live decades longer.
• Estate Planning: Update wills, beneficiary designations, and trusts to protect the younger spouse and ensure your assets are distributed as intended.

By preparing for these scenarios, you can protect your loved ones and your legacy.

Why Work with a Financial Advisor?

Retirement planning for age-gap couples is complex. An experienced financial advisor can help:

• Optimize Social Security and tax strategies.
• Create customized plans for income generation and wealth preservation.
• Adjust your strategy as life circumstances and goals evolve.

Look for an advisor who understands the unique challenges of age-gap planning and can tailor advice to your situation.

Retirement planning is rarely one-size-fits-all, and for couples with an age difference, it’s even more personalized. The good news is that this difference doesn’t have to be a challenge—it can be an opportunity to create a retirement plan that works well for both of you.

Click here to schedule a complimentary consultation to discover how we can help you achieve financial success.