You don’t need to be an actuary to predict that for married couples, there will come a time when one spouse will be aging alone. You can see insights on key differences between how men and women experience widowhood in a recent report from the Stanford Center on Longevity (SCL), published in The Journal of the Economics of Ageing. These insights can help married couples make critical decisions as they transition into retirement.
Men and women tend to experience widowhood differently
“Women are more likely than men tend to experience a significant financial shock after being widowed, while more men than women tend to suffer emotionally,” observes Jialu Streeter, author of the SCL report.
For example, in the first two years after losing a spouse, widows suffer an average drop of 22% in their income, after adjusting for the reduced household size. They also experience a 10% drop in their wealth. In subsequent years, widows are more likely than men to continue tapping their existing savings to supplement that reduced income.
By contrast, widowers’ financial conditions tend to stay relatively stable after the death of their spouse, but their emotional and mental health tends to decline due to increased rates of loneliness, depression, and sadness.
These two observations can provide guidance to married couples regarding steps they can take as they transition into retirement that will help the surviving spouse get through a difficult time in the future more easily. But don’t let the thought of widowhood be your only motivator: The advice offered in these steps are beneficial for most married couples at any stage of their retirement.
Coping with the financial aspects of widowhood
Married couples will want to make choices that prevent significant decreases in retirement income and wealth upon the death of either spouse. Here are considerations and decisions that can help with this goal:
- Optimizing Social Security through a careful delay strategy can also maximize the income to a surviving spouse. But even when retirees optimize their Social Security benefits, there can be a drop of one-third or more in Social Security benefits received by the household upon the death of one spouse. Fortunately, the advice offered in the next bullets can help offset this loss.
- If one or both spouses has earned a traditional pension benefit, or if they purchase a payout annuity, they can elect a 100% joint and survivor benefit that will continue all of the pension or annuity after the death of one spouse.
- Married couples can adopt a conservative strategy for drawing down 401(k) and IRA assets to generate retirement income.
- They can adopt a strategy to address the threat of high bills for long-term care, to help prevent exhausting assets if the first spouse to die needs expensive care.
There can be additional ways to improve the financial security of a surviving spouse. However, doing a good job with the above steps can go a long way to building financial security for a married couple while they are both alive, and also for the surviving spouse, whether that’s a man or a woman.
Coping with the emotional aspects of widowhood
Retirees would do well to put as much time and effort into nurturing their social portfolio as they do when building their financial portfolio. In particular, it’s very likely that as you age, you’ll become more reliant on family and friends for emotional support as well as for instrumental support with your daily activities.
To that end, you would do well to make new friends, be active in your community, and stay in frequent contact with existing friends and family. In particular, the SCL report shows that having children and grandchildren nearby can help improve the emotional condition of widowed fathers.
When thinking about your emotional or social needs in retirement, one important step is to examine your current home and community to see if it will meet your needs all the way through the rest of your life, even when you’re aging alone. That home in the suburbs that might have been a great place to raise a family might be too isolating during your retirement years, particularly if you’ve been widowed.
You can also help nurture your emotional well-being by creating a new identify for yourself when you retire (one that doesn’t revolve around work), finding a sense of meaning and purpose, and pursuing activities that can reduce stress and help you find peace of mind. These activities can include exercise, engaging hobbies, meditation, yoga, mindfulness, tai chi, forgiveness, and prayer.
Like most retirement planning decisions, exploring and implementing the above suggested steps will take some time and effort, but it’s well worth your time. Planning together to make sure the surviving spouse will be OK is a terrific way to say to each other “I love you!”