Conventional wisdom says child-free couples need a smaller retirement corpus. In reality, longer retirements, caregiving costs and the absence of a family safety net can make financial planning more demanding.

This is a monthly column in Mint by Priya Sunder, Director and Co-founder of PeakAlpha.

Anita and Sanjay, both in their forties, laughed off the idea that retirement would be expensive. Without children, they assumed they would need far less money than couples with kids and hoped to retire within the next few years.

Many child-free couples make the same assumption: without the cost of raising children, they will need less money in retirement. On paper, the logic seems sound. In reality, retirement planning for child-free couples is often more complex. They face a different set of financial goals, risks and priorities, and, paradoxically, may need a larger retirement corpus.

The biggest risk is underestimating the cost and complexity of ageing. Child-free couples need to confront practical questions early. Who will step in if they can no longer manage on their own? If one partner dies first, who will take the surviving spouse to hospital, ensure medicines are taken on time, file insurance claims, pay bills or handle tax filings?

The answer may be another person, but the implication is financial. As they grow older, they may need nursing support, assisted living, specialized medical care or a full-time caregiver. For many child-free couples, each partner is the other’s primary caregiver. If one is no longer able to provide that support, the substitute is often money—a corpus large enough to pay for care when it is needed.

Many parents assume, often implicitly, that their children will help coordinate care, make decisions, provide a physical presence and, in some cases, offer financial support. Child-free couples do not have that assumed safety net. Their financial plan must therefore explicitly provide for care, support and decision-making in later life.

Retirement planning: More than a corpus

For child-free couples, retirement planning is not simply about building wealth, funding children’s education and leaving an inheritance. Their plan must reflect a different set of choices and risks.

Although they may have fewer liabilities and lower day-to-day expenses, their retirement corpus may still need to be larger than expected. A sound retirement plan cannot simply inflate today’s expenses over time. It must also account for care costs, flexibility and the uncertainty of a retirement that could last decades.

Equally important is understanding how much they can spend. A good financial plan should model different spending scenarios and indicate when expenses can be increased, reduced or redirected. Sometimes the most valuable advice is reassurance: they may already have enough and need not spend their lives earning more, saving more or indefinitely postponing enjoyment.

A useful framework is to divide retirement assets into three buckets: one to meet essential expenses, another to fund the lifestyle they want, and a third reserved for contingencies they hope never arise. This allows them to enjoy their wealth today without compromising financial security later.

Ironically, a child-free couple may require a larger retirement corpus than a couple with children. Anita and Sanjay’s case illustrates why. Because they hoped to retire early, they had to plan for nearly 50 years after retirement instead of the more typical 30-year period. We see this pattern repeatedly among child-free couples, whose lower financial obligations often encourage earlier retirement but also lengthen the period their savings must support.

Insurance: Protecting the plan

Insurance is critical to ensuring that the retirement plan remains resilient. Comprehensive health insurance, supplemented by critical illness and disability cover, can protect retirement savings from large and unexpected medical expenses.

Life insurance may not be necessary if the retirement corpus is already sufficient to meet future needs. It can, however, play an important role in estate planning, providing income security for the surviving spouse or supporting dependants if the couple has assumed responsibility for another family member.

Estate planning: Inheritance, incapacity and control

For couples with children, the answer to who inherits their assets is usually straightforward. For child-free couples, it is often less obvious. Should the estate pass to relatives, close friends, a charitable trust or another cause?

Many child-free couples would rather spend their wealth during their lifetime than leave behind a large estate. Some may prefer to make gifts while they are alive. But doing so requires careful planning. A strategy that assumes life expectancy ends at 80 can quickly unravel if the couple lives well into their nineties. Spending plans therefore need to be reviewed regularly and adjusted as circumstances change.

Estate planning should also prepare for incapacity. If either partner can no longer manage financial affairs, a trusted person—ideally someone younger—should be authorised to help execute decisions relating to investments, taxes, withdrawals and day-to-day finances.

For child-free couples, retirement planning is about far more than investments or accumulating wealth. It is about ensuring the resources, support and autonomy to age with dignity. Calculating the numbers is the easy part. The harder questions concern dependence, care and who will make decisions when they no longer can. The answers to those questions ultimately distinguish a retirement plan that looks good on paper from one that works in real life.

Priya Sunder is director and co-founder at PeakAlpha Investments.