A “solo ager” is someone who retires without any relatives or close friends in their near proximity. A growing percentage of Americans, whether single, widowed, or divorced, live alone, making solo agers more common. Furthermore, many are childless or have adult children who live far away, leaving them to their own devices. If this describes you, there are a few financial considerations specific to you.
Solo retirees who are well-prepared for retirement are typically the happiest. This involves being prepared for impending financial and legal concerns. If you do not have close friends or relatives nearby, you will face some unique challenges. That’s what we’ll go over today.
Who to Appoint to Make Financial Decisions?
Without relatives close, resolving certain financial concerns may be more difficult. This is because you need to find trustworthy people who can help you. If you are ever unable to make decisions for yourself, who will make them for you? Although it is a difficult question, it must be discussed. It may not actually be the best idea to appoint family and friends to the posts of executor and proxy. Nonetheless, they are typically the first choice.
Before delegating these responsibilities, ensure that the people you choose will be responsible. Make it clear to them what you expect from them. These positions may also require certain skills and knowledge. If you need a friend to serve as your executor or healthcare proxy, you must ask yourself several questions; do they have the time? Is it safe to assume they’ll outlive you? Are they financially literate? Also, can you afford to compensate them?
Have a Checklist and Other Legal Directives
Solo agers will require a living will to specify how they want certain situations to be handled. A living will is essentially your written instructions on how you wish to be treated in medical conditions in which you are unable to make decisions for yourself. This could include your desire to avoid taking measures to extend your life. Examples include CPR, a mechanical respirator, intravenous or tube feeding, dialysis, and so on. All 50* states enable you to “express your wishes regarding medical treatment in terminal illness or injury situations, and to appoint someone to communicate for you in the event you cannot communicate for yourself.”
In contrast, a healthcare proxy is a durable power of attorney that precisely specifies the person you want to carry out your intentions and make medical decisions on your behalf if you are unable to. Your lawyer can help you with the preparation of these documents, and you should also ensure that your family is aware of them. It is also a good idea to give copies to your doctor and/or keep them with you in case you are admitted to the hospital.
What Local Professional Resources Can You Use?
Positions that are often filled by family members may instead be filled by qualified financial professionals. For example, an elder law attorney could be part of your legal team. A geriatric care manager or patient advocate may also be involved in overseeing healthcare decision-making. In addition, you should have a financial professional handle your finances. Furthermore, if possible, you should have nearby friends or neighbors who can help you in times of need.
Have a Financial Power of Attorney or Revocable Living Trust
As you approach retirement, you must begin planning for a possible time in the future when you may be more vulnerable. Even if you currently feel relatively safe and independent as a solo ager, this may change in the future. Though there are some measures in place if you did not plan ahead of time for certain circumstances. But, in general, you should avoid the possibility of your finances being in the hands of strangers who are not financial professionals.
You may have been encouraged to appoint a financial power of attorney to handle your finances. However, if you are a solo ager, you may be better off* with a revocable living trust that offers more privacy and freedom. Speak with an elder law attorney to determine which financial solutions are best for your specific situation.
*Sources: Right at Home, Kiplinger