These days, being single in adulthood isn’t an anomaly. Indeed, 46.4% of U.S. adults are single, according to the Census Bureau. That means many Americans are preparing to retire solo — and, when you do the math, it can cost a lot more to go it alone.
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Maybe you’ve never married. Or, maybe you’re divorced and open to the idea of a new relationship. Even still, you may not want to get married again — and you may want to retain your newly found financial independence.
So, if you’re 50 years old, single and want to live your best solo life in retirement, here are a few things you should consider.
Why it can costs more to retire solo
If you’re single and living alone, you can’t split the costs of housing, utilities, groceries and other bills. You also don’t have access to spousal workplace benefits, nor can you share tax benefits. Plus, in retirement, you won’t be able to share a spouse’s Social Security benefits, savings or pension. As a result, you’ll likely pay more toward expenses alone in retirement than those in a dual-income household.
When your expenses are higher, it can be harder to save, too. And it can be even harder for single women. That’s because women still make less money than men for doing the exact same job in the U.S., earning $0.84 for every $1 earned by men as of 2022, according to Census Bureau data.
Making less money relative to men and also being more likely to leave the workforce during child-rearing years, women also typically have a lower Social Security benefit. As of December 2023, the average monthly benefit for a retired man was $2,159.18, while the average benefit for women was $1,729.13, Social Security Administration data shows. This is compounded by the fact that women tend to live longer than men by nearly six years, according to the CDC’s National Center for Health Statistics.
Planning for retirement as a 50-year-old single person begins pretty much the same as anybody else. Start by calculating your monthly living expenses (rent, bills, vehicle payments and incidentals) and consider which of those will change in retirement. Will you have paid off your mortgage? Do you have medical costs that won’t be covered by Medicare?
As a single person, you will be responsible for covering the entire household budget, so the numbers you crunch for your retirement will reflect that. If you have children (even if they’re adults), it may be harder to set money aside if you’re still supporting them. If you’re divorced, you may need to factor in child support, alimony payments and the splitting of any shared retirement savings.
Another major consideration is health care. Many couples can rely on their spouse as a caregiver, at least initially, if their health fails. Singles don’t have that option. You’ll need to plan for the possibility of caregiving, such as assistance with daily living or long-term care costs. You may want to consider opening a health savings account or purchasing long-term care insurance.
Overcoming financial challenges
Many financial advisers recommend saving 10% to 15% of your pre-tax income for retirement. If you’re single, you may want to put at least 15% aside, while maximizing contributions to tax accounts whenever possible (such as a tax refund or job bonus).
You could also consider working longer and delaying retirement to continue building your nest egg. The longer you delay taking your Social Security benefit, the larger that benefit will be. In addition, take advantage of 401(k) employer matching if it’s available to you. If you’re able to pay off your mortgage before you retire, then you’ll reduce one of your largest expenses in retirement.
Another strategy for singles? You may want to consider getting a roommate (maybe even one of your grandkids), sharing a home with a friend or family member, or even renting out your basem*nt to make some extra cash. That could help you benefit from some of the cost sharing that couples enjoy. It may also be worth sitting down with a financial planner so you can chart a path to living your best solo life in retirement.
You also don't have access to spousal workplace benefits, nor can you share tax benefits. Plus, in retirement, you won't be able to share a spouse's Social Security benefits, savings or pension. As a result, you'll likely pay more toward expenses alone in retirement than those in a dual-income household.
In general, by age 50, Fidelity says that you want to have about six times your annual income in retirement savings. So, for example, with a national median personal income around $40,500, you would want about $243,000 in your retirement account by age 50.
To fund an “above average” retirement lifestyle—where you spend 55% of your preretirement income—Fidelity recommends having 12 times your income saved at age 67, which is the normal Social Security retirement age.
By age 35, aim to save one to one-and-a-half times your current salary for retirement. By age 50, that goal is three-and-a-half to six times your salary. By age 60, your retirement savings goal may be six to 11-times your salary.
You probably want to start contributing at least $500 a month to an IRA or 401(k) at this stage of life if you have a $0 balance to start with. Once you figure out how much money you can contribute toward your savings each month, put the process on autopilot.
The ideal monthly retirement income for a couple differs for everyone. It depends on your personal preferences, past accomplishments, and retirement plans. Some valuable perspective can be found in the 2022 US Census Bureau's median income for couples 65 and over: $76,490 annually or about $6,374 monthly.
Retirement-age men have a median income of $31,220 compared to women, who take in $27,350, according to the Census Bureau and Bureau of Labor Statistics. On average, men 65 and older earn $50,490 per year compared to $40,830 for women. Those statistics are for male and female householders living alone.
Summary. Retiring with $200,000 in savings will roughly equate to $15,000 annual income across 20 years. If you choose to retire early, you will need additional savings in order to have a comfortable retirement.
You can stop working before your full retirement age and receive reduced benefits. The earliest age you can start receiving retirement benefits is age 62. If you file for benefits when you reach full retirement age, you will receive full retirement benefits.
Get a Part-Time Job or Side Hustle. If you're contemplating retirement with no savings, then you may need to find ways to make more money. Getting a part-time job or starting a side hustle are two ways to earn money in your spare time without being locked into a full-time position.
Many retirees with little to no savings rely solely on Social Security as their main source of income. You can claim Social Security benefits as early as age 62, but your benefit amount will depend on when you start filing for the benefit. You get less than your full benefit if you file before your full retirement age.
IRA plans. An IRA is a valuable retirement plan created by the U.S. government to help workers save for retirement. Individuals can contribute up to $7,000 to an account in 2024, and workers over age 50 can contribute up to $8,000.
Experts say even in your 50s, it's not too late to take steps to get in better financial shape. “While retirement is an exciting vision for a lot of people, the transition can be really stress-inducing,” said Keri Dogan, senior vice president of financial wellness and retirement income solutions at Fidelity.
With $300,000 planned for your use as a retiree, a retirement age of 50, and an anticipated life expectancy of 85 years, you need that money to last you 35 years. This should mean that your yearly income is around $8,571, and your monthly payment is around $714.
How much money you should have saved by 50, according to financial experts. By age 50, most financial advisers recommend having five to six times your annual salary saved.
At the age of 50, ideally, you would have wanted to save over 4 times your annual salary if you would like to retire comfortably. At this age, you should be considering putting 25% of your salary into your pension pot, if not more.
At age 50, you can start making extra contributions to your tax-sheltered retirement accounts (called catch-up contributions). Younger workers can only contribute $23,000 to their 401(k)s and $7,000 to their IRAs in 2024. But Americans aged 50 and up can contribute up to $30,500 in a 401(k) and up to $8,000 in an IRA.
Introduction: My name is Kelle Weber, I am a magnificent, enchanting, fair, joyous, light, determined, joyous person who loves writing and wants to share my knowledge and understanding with you.
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