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Retirement Planning Considerations for Couples with an Age Gap

Paul Tarins, RICP®,WMCP®,CSRIC™

Decisions surrounding retirement are rarely simple. This further becomes the case when there is an age gap between couples, resulting in differences in retirement dates, life expectancy, health and more. 

For couples of varying ages, traditional retirement advice may not be applicable. Their retirement fund will provide for not just one but two individuals in different stages of their lives and careers. If there is an age gap between yourself and your spouse, here are a few retirement considerations for couples to consider. 

Consideration #1: Your Retirement Date

One of the most critical details to consider for retirement planning is the start of your retirement. If one spouse continues working while the other is retired, how will the dynamic shift? Alternatively, you may choose to retire at the same time. 

Staggering the start of your retirements can also be beneficial. For example, if the younger partner continues to work, they may maintain employer health coverage until both partners are eligible for Medicare. Additionally, their earnings can reduce the need to minimize the portfolio, extending the length of their savings. 

It’s possible that one spouse retires early so that the couple can stop working at the same time. Or perhaps, the older spouse loves their job and has no problem working for a few more years. Ultimately, the decision comes down to you as a couple and your approach to the circumstances. Either way, it’s crucial that you consider this because the decisions you make regarding the beginning of your retirement chapter will impact how you plan financially. 

Consideration #2: Social Security

Another key detail to be considered for strategic retirement planning is when to begin collecting Social Security. If an age-gapped couple retires at the same time, the younger spouse may receive reduced benefits. Alternatively, if the younger spouse begins collecting benefits at age 62, their lifetime benefit could be reduced exponentially.1 

If the older spouse makes more than their partner, it may make more sense for them to delay taking Social Security benefits for a few years. By waiting, the older spouse’s benefit will grow eight percent each year past their Full Retirement Age (FRA) up to age 70.2

Consideration #3: Your Investments

As retirement nears, investments often move from a more aggressive, growth-oriented portfolio to a conservative, wealth-preserving portfolio. In the case of retirement considerations for couples, if your partner is significantly younger than you, you may consider maintaining a slightly more aggressive portfolio than couples who are closer in age. This allows your retirement savings to benefit from more growth potential, ultimately benefiting your spouse later in life. Although the potential for losses during a market downturn increases, the younger spouse can help offset them with ongoing contributions from paychecks (if they are still working). 

Consideration #4: Health Costs and Life Insurance

When it comes to retirement considerations for couples, there is a key advantage to being in a partnership with an age-gap: the younger spouse will likely be able to care for the older spouse if needed. On the other hand, the younger spouse’s long-term care needs are then put into question. 

Purchasing a long-term care policy that covers only the younger spouse may be beneficial to your relationship. Alternatively, using a portion of your 401(k) as the younger partner to buy a Qualified Longevity Annuity Contract (QLAC) to cover costs is another available option. In this case, the income stream referred to as a longevity annuity begins years after purchase and allows individuals to create an additional income stream in retirement.3 

No matter your circumstances, you should feel assured that there is a retirement strategy that fits the needs of every couple, regardless of their age difference. However you choose to approach retirement as a mixed-age couple, you’ll both enjoy that time away from work when you know age is no longer a factor in your life together. 

Consideration #5: Your Pension

This can be a valid retirement planning consideration when the older spouse is eligible to receive a pension. A common option here is to apply for a joint-and-survivor payout option. The biggest drawback to this option is that the younger spouse will collect a smaller income throughout their life.

On the other hand, a joint-and-survivor pension is a popular option for couples with an age gap because it ensures that the younger spouse continues to receive the agreed pension payments even if their older partner passes away. In a joint-and-survivor payout, the payments continue until the second spouse passes away.

There are several options to a joint-and-survivor payout option.4 You can choose between a 50%, 75%, and 100% annuity. These figures describe the level of benefit the beneficiary will get in comparison to the principal holder. For example, a 100% payout option will mean that the younger spouse (beneficiary) will get the same monthly payments as their older counterpart (principal holder). Similarly, a 75% option will mean that the younger spouse gets 75% of the monthly payments and so on. Though the 100% option may seem like the best one on the surface, remember that it will also provide a lower monthly payout. The highest monthly payout will be in the 50% contract.

Consideration #6: Your Estate Plan

This list of retirement considerations for couples with an age gap simply won’t be complete without mentioning the estate plan. An estate plan is essential in easing the transition process for beneficiaries and cutting avoidable taxes.

An estate plan becomes even more important for couples with an age gap since there are often some very complicated family dynamics. For instance, it’s not uncommon for one spouse to have been previously married and have children. You will need to make sure that everything is in place to manage the pressure on your children and the age-gap spouse.

Essentially, the estate plan is set in place to cover children from previous marriages and balances longevity problems with a younger spouse. An estate plan is normally personalized to your needs but there are some recurring themes, such as:

  • Smooth transition of assets to heirs
  • Forming a legacy. This could include gifts to churches, charities, and other such organizations.
  • Deferring or minimizing taxation and reducing your taxable estate.
  • Gathering liquidity for estate settlement taxes and costs.

Wrapping Up

Retirement planning is an essential part of our lives. However, it becomes even more important when we have a spouse with an age gap. Careful planning and well-thought-out strategies can go a long way in helping you and your partner enjoy a comfortable retirement


  1. https://www.ssa.gov/OACT/quickcalc/spouse.html
  2. https://www.ssa.gov/benefits/retirement/planner/delayret.html
  3. https://www.annuity.org/annuities/qualified-longevity-annuity-contract/
  4. https://www.consumerreports.org/cro/2014/03/best-pension-payout-option/index.htm#:~:text=A%20joint%2Dand%2Dsurvivor%20annuity%20pays%20you%20during%20your%20lifetime,monthly%20benefit%20that%20you%20received.



Paul Tarins is an investment adviser representative of and offers investment and advisory services through Portfolio Medics, a registered investment adviser. Nothing contained herein should be construed as a solicitation for investment advisory services. Sovereign Retirement Solutions and Portfolio Medics are not affiliated.