Retirement decisions are always complex, but they can be doubly so when there's a big age gap between spouses. Much of the standard retirement advice may not work for age-gap couples.
"You have to throw away the playbook that you would use for a couple retiring at a similar age," says Steve Parrish, director of the retirement income center at The American College.
About 9 percent of all married couples have an age gap of 10 years or more, although the gap is more often seen in later-in-life second marriages with men older than their spouse, according to the U.S. Census Bureau. When it comes to retirement planning, these couples often feel they've fallen out of step, advisers say.
Here are four common problems that age-gap couples face:
Disagreement on the retirement date: Often the older spouse is ready to retire before the younger mate. How can they coordinate their retirement dates? Advisers offer a simple answer: Don't even try.
Staggered retirement dates can be a boon for age-gap couples. A younger spouse who continues to work, for example, might maintain employer health coverage until both partners are eligible for Medicare, and his or her earnings can reduce the need to draw down the portfolio, helping the nest egg last longer.
Uncertainty over when to take Social Security: The Social Security claiming decision is crucial for age-gap couples. That's because the younger spouse may live decades longer than the older partner, and a Social Security survivor benefit could make or break his or her later retirement years.
To find your optimal claiming strategy, try a free calculator such as OpenSocialSecurity.com or use a paid service such as Social Security Solutions, which offers claiming strategies starting at about $20.
Not knowing which drawdown strategy to use: Age-gap couples' combined retirement could easily last 40 years, and their Social Security, pensions and other retirement income sources may phase in over a period of a decade or more.
In such scenarios, the standard advice on safe withdrawal rates "can be misleading," says Dana Anspach, of Sensible Money, in Scottsdale, Ariz. Some couples, for example, may need to make large portfolio withdrawals in the early retirement years, but their drawdown rate drops substantially after Social Security and other income sources kick in.
Online services such as Income Strategy (www.incomestrategy.com) can help you map out a portfolio drawdown strategy and decide which assets to tap first in order to minimize your tax bill. When you know which accounts you'll draw from first, that will help you solve the asset-allocation puzzle.
If an older spouse plans to pull money first from his IRA, for example, he or she should shift that account toward bonds, while a younger working spouse might tilt his or her 401(k) toward stocks.
Paying for long-term care: Age-gap couples have one advantage — the younger spouse will likely be able to care for the older spouse if needed. But what about the younger spouse's long-term-care needs?
One option is to buy a long-term-care policy that covers only the younger spouse, says Ekta Patel, a financial planner in New York. The premiums can be high, but "there's a case to be made for having some long-term-care insurance, even if it funds only a portion of your needs," Patel says.