Retirement Plans For Single Ladies

by Galia Gichon on April 13, 2012

retirement single ladiesThe following article was written by a wonderful client of mine, Adina Saperstein, Co-founder and Director of Veneration Inc. (this article can also be found here).  Her honesty and enthusiasm to finally take control of her finances have been an inspiration to me.  I hope it is for you too.


 

Today I went to see Galia Gichon, founder of Down to Earth Finance. I first met Galia after taking over my mom’s finances when she could no longer manage them.  In my mid-thirties, although I was saving for retirement, I had no savings or investment strategy. I’d lost track of 401(k)s from previous jobs.  I realized I better get my own shit together while I still had time.

Today we talked about savings – the part I won’t touch for the next year as I transition from a full time job to a hybrid livelihood of freelance consulting, real estate management, and non-profit start-up; and the long-term retirement portfolio that needs to be rebalanced annually.

Once we got through all that, she had another topic on her agenda.

“I don’t want to scare you,” she said with a smile, “but that’s sort of my job.” She pulled up a crazy excel spreadsheet that calculated how long I’d be able to live on my retirement savings if I were to retire in 30 years (at age 65), if I kept saving at the rate I have been diligently for the past 15 years.  I’d  barely make it to 80 – well before my life expectancy.

If I think I might happen to live another decade like most of my grandparents, I would need to start putting away $14,000 per year – not the kind of change most freelancers or social entrepreneurs have lying around when December rolls around.  And I’m the exception – according to a recent survey, most of my peers haven’t even starting to save for retirement at my age: the average age younger Americans start saving for retirement is 38, and 60% of my Gen X peers have not bothered to calculate how much they will need to save for retirement.

That much I was prepared for – the next part, not so much.

“I don’t know what your plans are,” Galia said with her firm gaze and soft smile, “but if you don’t think your going down a path that includes a partner and children, I highly recommend you think about long-term care insurance.”

I looked at her, stunned.

“Have you thought about it?” she pressed.

I have thought about long-term care insurance more than probably 99% of my peers.  According to most retirement specialists LTC insurance is the single most important investment that Boomers can make in their retirement. With long-term care costing an average of $6,000 per month, this insurance provides a safety net for people who would otherwise be unable to afford it. And it protects a system that would otherwise have to fund care for the vast majority of the population – bankrupting the system at record speed.

Unfortunately when it came to my mom, by the time we became aware that such a thing existed, it was way too late to get her a policy.

So yes I’ve thought about LTC insurance.  But for myself??

“When do you actually advise people buy LTC insurance?” I asked Galia.

“When you’re 40 you start looking at quotes.” She said.

Since then I’ve been thinking about my reference point for all this.  As a woman who came of age with Sex and the City, my cultural sensitization to the financial lives of single women stretched to shopping, jobs, babies and real estate. But aging?

Did the SATC ladies ever look with dismay at a 401(k) statement? More telling: did any of them ever confront the much more immediate issue of an aging parent?  Correct me if I’m wrong, but in 5 seasons I think only once did a parent appear on the scene – well actually not on the scene, because she was already dead – when Miranda’s mother dies suddenly and the others put on their black dresses and catch the train to Philly for the funeral.  Living, breathing parents, with all their extraordinarily ambivalent relationships, were essentially invisible.

That pretty much reflects the cultural norm when it comes to aging – ignore it.  If those characters were real, those ladies, in their mid 40’s by now, would be grappling with parents and questions just like long-term care.

Popular culture, as well as education, needs to catch up with the realities of our aging demographics.

You can find more resources on long-term care insurance on Veneration’s site by clicking here.

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