6 Things To Do Differently When Planning for Retirement If You Don’t Have Kids
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Retirement advice in America often assumes a familiar path: work hard, raise kids, retire, pass something on. But what if you’re not following that script?
For a growing number of Americans without children, retirement planning can look fundamentally different. Without heirs to support or inherit assets, decisions around spending, estate planning and long-term care have different expectations. Here’s what financial planners said people without kids should do differently.
1. Rethink the Entire Retirement Framework
Standard retirement models are often built around legacy planning and avoiding running out of money at all costs. That mindset may not fit those without kids.
“Child-free people tend to follow a FILE (Financial Independence, Live Early) path rather than FIRE,” said Jay Zigmont, CFP and founder of Childfree Trust.
If FIRE (Financial Independence, Retire Early) and classical retirement is an “on/off switch for work,” Zigmont said that FILE is more of “a dimmer switch” with the focus being on “doing the right work, at the right time, across life.”
He added that many child-free people embrace a “die with zero” approach vs. passing on generational wealth.
Being child-free also changes withdrawal assumptions. General rules like the 4% safe withdrawal rate and Monte Carlo simulations are designed to avoid running out of money. For child-free retirees, Zigmont recommends at least a 5% safe withdrawal rate.
2. Align Spending With Your Life — Not a Legacy
Without children, retirees may have more flexibility in how and when they spend, but it should match their goals, Zigmont said. For example, renting is often better for child-free people than owning a home because it prioritizes flexibility.
Joseph M. Favorito, CFP and managing partner at Landmark Wealth Management, LLC, said that when legacy planning is not the focus, “you can potentially spend more if you have the assets to do so.” Still, he cautioned that there are “constraints on the amount of permissible spending annually as a percentage of your liquidity.”
One of the things you do need to set money aside for is money for caregivers, according to Pamela Garrett, an estate attorney and owner of Law Mother Asset Protection & Estate Planning, “since you won’t have adult kids to step in as caregivers and helpers.”
3. Assign Someone To Make Decisions for You
Ironically, having no heirs can make estate planning more urgent, not less, Zigmont said.
His company recently surveyed 600 people without kids about estate planning and long-term care plans. The study found that only 19.9% of child-free people have a will in place, and only 14.6% have long-term care insurance, he said. Without next-of-kin, retirees need to designate a guardian or conservator to make decisions for you when you can’t.
Without children, at least create a beneficiary list to minimize the work to settle an estate for whomever is responsible, Favorito added.
4. Build a Long-Term Care Plan Early
The most common question child-free adults hear is about who will care for them later, Zigmont said. He encourages clients to put a long-term care plan in place by their mid-40s, including “both how to pay for it and an estate plan that outlines who makes decisions for you when you can’t.”
“Assume this type of care will be needed, not if,” Garrett added. “You need a coordinated plan.”
5. Focus On Tax Efficiency During Life
Without a next generation in mind, tax planning shifts toward maximizing what you use, not what you leave.
Garrett recommended prioritizing tax efficiency during your lifetime. This could look like Roth conversions or charitable deductions and timing your withdrawals.
“Your goal is to shift what is usable in life, not what is left.”
6. Don’t Assume Planning Is Simpler
While life may be a bit simpler without children, retirement planning is not necessarily, Zigmont explained. Traditional advice assumes, “Getting married, having kids, working 25 years, retiring and passing on wealth.” If a planner says a child-free plan isn’t different, Zigmont advised finding one who understands that it is.
Retirement planning is still goal-based planning.
“Everyone has a different set of goals with or without children,” Favorito said. The key is ensuring your plan reflects your particular path.
More From GOBankingRates
