Posts Tagged "adult children"

Family on a dock

Men Make Bigger Changes After Retiring

Men are from Mars. Women are from Venus. That continues to hold true in retirement.

A new study that examines two aspects of this major life change – personal and financial relationships – finds that men and women use their newfound freedom in different ways.

The change in men’s social lives after they retire is more dramatic because they greatly expand their network of friends, adult children, and extended family, and they have more conversations with them about personal matters.

Men “become more dependent on family,” concludes research by two University of Wisconsin sociologists.

Retirement doesn’t mark the same type of social shift for women, however. They already had a larger network and always took more responsibility for maintaining relationships, and not much changes in retirement – with one exception. Women increase the number of hours spent taking care of their grandchildren.

The differences are consistent across much of the western world, according to this study, which was based on surveys in the United States and Europe – from Sweden to Spain to Estonia. Although married and single people participated in the survey, the heart of the analysis was asking each individual this question:

“Looking back over the last 12 months, who are the people with whom you most often discussed things that are important to you?” Each individual listed up to five people in their networks, the nature of the relationships, and how often they are in contact.

In addition to branching out socially, retired men are more likely to give money to offspring or other family members. In married couples, this is often jointly decided by husband and wife. But the actual money transfers picked up only after the men – and not the women – retired and had more energy to devote to family. …Learn More

Last will and testament

Retirees Intent on Leaving Homes to Kids

Every year, older homeowners leave billions of dollars worth of the wealth locked up in their houses to their adult children.

This is a paradox if one considers that home equity is one of retirees’ primary assets and could be a crucial source of income for people who are “house rich and income poor.” Retirement experts searching for an explanation have long wondered whether the deceased had intended to leave the house to family or simply died before they were able to cash in on the equity and spend it.

A new study has an answer: retirees have every intention of letting family members inherit their homes. The people in the study who expressed a stronger desire to leave an inheritance of at least $10,000 were much less likely to sell their homes before they died – with the intention that the house would be part, if not all, of that inheritance.

The foundation for this study is a precise estimate of the housing decisions being made in the final two years of life from a survey of older Americans. The researchers counted as many people as possible, including the deceased – their final living status came from interviews with next of kin – as well as people who continued to be homeowners after going into hospice or a nursing home.

The homeownership rate in the older population peaks around age 70 and starts falling precipitously after 80. But when the elderly in the study died, about half of them still owned their homes, while the other half had sold them and moved into rental housing.

At younger ages, the retirees had been asked to estimate the probability, from 0 (no chance) to 100 (definitely), that they would leave a financial inheritance. Based on this information, the researchers found that those who had said they had a high probability of leaving an inheritance remained in their homes.

There is also a financial advantage to the owner of not selling the house to avoid the capital gains tax, especially if the price appreciated dramatically during their lifetimes. The researchers didn’t account for this incentive in their analysis.

But they did find that the desire to leave a bequest is so compelling that parents held on to their homes even after predicting they might need to pay for nursing home care within a few years. …Learn More