Financial Tips if You’re Single and Senior

Widowed, divorced, and never-married seniors have unique challenges as they age. With this in mind, experts offered five lesser-known financial recommendations for single seniors.


1. Create a Trust Document.

Just as newly widowed seniors may have found themselves looking for a safe-deposit box key, requiring an unknown online password, or wondering if they were aware of all their late partner’s accounts, single seniors must consider who will need what information (including medical directives) when they pass away or are no longer capable of providing it.

John DeYoe of DeYoe Wealth Management says, “A trust is the document that makes the decisions for your assets after you are gone. It’s critical we do it for folks under 55.” However, he also notes that only 30-35% of those under 55 whom he sees actually have their trusts in order.

Seniors must explain their intentions to their kids.“Seniors today never communicated about this stuff, kids don’t know where anything is, don’t know what their parents’ desires are,” says DeYoe. “We recommend a love letter be written around Thanksgiving to chronicle this stuff. Tell your story. You want to record in some way, “In my life, the most significant lesson I learnt was…”

Those senior citizens who have already identified their beneficiaries aren’t exempt from this either. The Retirement Learning Center’s founder and president, John Carl, suggests performing a “Beneficiary Audit.”

“If you are a senior who is single, you may not have always been single. And everyone who lives a complete life experiences changes. They must name a beneficiary whenever they open an IRA, purchase an annuity, purchase life insurance, or invest in a retirement plan. Carl argues that “such designations are essentially contracts.”

Having a legacy beneficiary on one of these items (contracts) suggests that the money will go to that legacy beneficiary even though your will and trust are up to date regarding where you want your assets to go if you pass away (i.e. ex-spouse, etc). For a senior living alone, a beneficiary audit is essential.


2. Get a Second Opinion.

Second opinions are often recommended following serious health diagnoses, but they can also be valuable in other ways later in life.

Senior citizens are frequently candidates for fraud, and singles may not have a confidant to seek counsel from about a deal that appears too good to be true (or even simply good). “If you’re a single senior, I basically advocate getting a second opinion,” adds DeYoe. He also suggests hiring a second attorney to review your trust “to ensure that what you want to happen will happen.”


3. Make Allowances for Inflation.

“Inflation is the biggest risk for younger single seniors,” adds DeYoe. Your purchasing power is being reduced year after year while you are completely unaware of it. If you don’t account for inflation, you’ll run out of money.

Another recommendation from Stephen J. Butler, President of Pension Dynamics Corporation, for not running out of money before the end of life is for single seniors to learn about bond funds or other tools for increasing retirement cash flow, such as Life Insurance Cash Values. “Bond funds generate greater attention than CDs. If you understand why bond fund capital values change, you can learn to disregard them.”

Retirees can make their hard-earned dollars go further and improve their quality of life in the ‘Golden Years’ by combining our proprietary ROQS Method with the other sources of tax-free cash flow outlined above.


4. Have a Backup Plan.

What if, in the worst-case situation, you outlive your financial resources? It’s especially a reality for women, who often outlive their partners. “Single senior women have acquired less retirement savings than their male counterparts,” Carl argues. They will have to catch up, he argues, and he suggests the following:

  • If you are qualified, make catch-up retirement contributions.
  • Continue working part-time in retirement.
  • Understand how divorce and death affect maximum Social Security benefits.

DeYoe predicts that as costs rise, “we’re going to see more and more people who don’t have enough money and have invested extremely cautiously. Taking care of people is going to be a major burden on states.” [Long-term care] can easily cost $6K per month, with costs rising considerably faster than inflation. Insurance corporations are attempting to persuade California to raise rates by 40%.”

According to DeYoe, singles should consider long-term care insurance, which is available in California and other states, because it helps preserve the assets of persons who require long-term care after their health insurance has expired.


5. Increase Your Chances For Happiness.

As retirement age approaches, many people recognize the importance of having a plan for retirement funds, but not enough people consider retirement fun. When work is your entire life, it may not occur to some to plan for a meaningful life after work, and this discontent can be exacerbated if the retiree does not live with a spouse.

“Keep in touch with your old coworkers,” recommends Ken Budd, Executive Editor of AARP The Magazine. In a recent poll of 3,012 people, the AARP discovered that 35% of adults over the age of 45 were lonely. Loneliness reduced participation in social activities and organizations such as religious groups and volunteering.

“People who are successful feel busier today than they did while they were working. They are involved, they are concerned about their legacy, thus they volunteer, and they have an attitude of personal progress, enjoyment, and experimentation. Those are the folks that thrive in retirement.”

Location is an important factor to consider when staying social and involved, and fortunately, US News has published its list of the top areas for single seniors to retire.

The world can appear unfairly tilted in favor of couples, especially to newly single people who have spent the majority of their adult life as half of a couple. Single seniors who want to travel should look into ways to avoid the dreaded single supplement of tour groups and cruises, and Budd also recommends volunteer vacations, often known as voluntourism, noting that he’s encountered many single senior women on such travels.


6. Consider Your Legacy

Legacies are most often thought of in terms of descendants. However, this is far from the only way to leave one. We can leave a legacy in a variety of ways, the most common of which is by how we live our lives, which serves as an example to others, and how we give of ourselves and our resources. It can be done financially through charitable giving; by relating to or mentoring others; by conveying thoughts and insights through writing, speaking, and teaching, and in a variety of other ways that are unique to each person.

The Charitable Payraise™ is a novel new financial strategy that allows a retiree to generate more tax-free income flow while also assisting charity. The technique combines the advantages of charitable contributions with the tax-free status of loans (exactly the same way loans from life insurance cash values are treated). 

This innovative new strategy maximizes the after-tax cash flow from the sale of valuable assets such as securities, real estate, investment property, collectibles, and even employer shares held in your retirement plan (NUA).