I attended an informal brown bag lunch session sponsored by UBS in our Chicago office. In most respects, the talk was about traditional retirement planning: IRAs; 401ks; wills & estates, etc. An interesting question came up from an attendee which I thought was both simple in its query yet eye opening in its response: “what is different for me as a single person (with no kids)?”
The UBS advisor noted that a single person does have a different set of retirement needs than a (gulp) ‘traditional’ situation of a married couple with children. On the plus side, a single person has no real need for life insurance, since there is no dependent relying on the single person’s income. Similarly, a childless single person should have less worries about burning through his or her financial assets during his orher lifetime, since there is no person or people whom the estate will need to (or seek to) support. So far so good.
On the downside, the UBS advisor noted that a single person will have to ensure funds are available for their long term care, especially since there will be no ‘moving in with the kids’ at a later stage in life. A single person should also identify a trusted advisor (accountant, attorney) to serve as a power of attorney in the event of incapacitation.
In many respects, a single person’s plan mirrors that of a coupled person: healthily fund retirement accounts; keep expenses modest; have contingencies in place in the event you are unable to make your own decisions. What is different, however, is that someone who is (and intends to remain) single does need to be more thorough in their plans, since there is really no fail-safe (ie someone else) in the absence of a plan.
— Tim Shields, UBS