Mar 8, 2026
Planning for retirement is never easy with the natural ebbs and flows of life and even the most conservative retirement plans can be upended by life’s unexpected turns.
You might need medical care or even end up caring for a dependent far past when you expected to have children in the home. If something happens, should you expect to work until you die?
Advertisement
Take this hypothetical example: Linda is 64 and had planned to retire next year at 65. She has about $400,000 saved for retirement, a paid-off home and expects to collect roughly $2,000 a month in Social Security. With just herself to worry about, that amount felt like enough.
Then her daughter unexpectedly passed away and Linda is now raising her 6-year-old granddaughter. Despite the joy of having her granddaughter, she's stressed about her finances.
Instead of budgeting for travel and Medicare premiums, she’s facing childcare costs, school expenses and the long-term financial responsibility of raising another child — all while worrying about her own healthcare and aging expenses. What once felt like “enough” suddenly doesn’t offer her a sense of security at all.
What to do when retirement plans change abruptly
Though hypothetical, this story highlights something many people near retirement don't think about: Retirement planning often assumes life will stay relatively stable and follow a predictable path. But caregiving, health crises and family emergencies can quickly change the equation.
Before adopting her grandchild, Linda’s numbers worked.
Using a conservative 4% withdrawal rate, her $400,000 nest egg could generate about $16,000 per year, roughly $1,333 per month. Combined with her projected $2,000 monthly Social Security benefit, she’d have about $3,300 per month to live on. With a paid-off house and modest expenses, that was a tight but workable budget.
But now she has to account for the cost of raising a child.
Advertisement
According to SoFi, the average cost of raising a child in the U.S. in 2024 is approximately $23,000 per year, or $414,000 from birth to age 18 (1). While Linda won’t bear the full 18-year cost, she could still face more than a decade of significant spending.
For a 6-year-old, major costs often include:
- Before/After care and summer camps: Even if her granddaughter is school age, before and after care plus camps for the summer months can cost hundreds of dollars a month.
- Health insurance and medical expenses: If Linda retires, she may have to pay for insurance out of pocket in most cases, unless her granddaughter qualifies for Medicaid.
- Food and clothing: This can add a significant amount to a yearly budget, especially as kids grow and need new clothes regularly.
- Education costs: School supplies, sports fees and activities can add up. If the child goes to college, that can add tens of thousands of dollars to the budget needs.
An additional $20,000 or more in annual expenses would dramatically alter Linda’s retirement math. Her planned $ 3,300-per-month income could not comfortably cover those added costs without either drawing more than intended or returning to work.
This is what makes unexpected caregiving roles so financially disruptive. Retirement plans are typically built around predictable expenses and a slow but steady drawdown of assets. Adding a dependent can increase your withdrawal rate and increase your risk of outliving your savings.
Must Read
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — are you doing the same?
- Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
- Robert Kiyosaki says this 1 asset will surge 400% in a year and begs investors not to miss this ‘explosion’
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
What options does she have to avoid working forever?
The reality is, Linda may not be able to retire exactly at 65, but that doesn’t mean she has to work indefinitely. The key is combining available support with smart timing decisions. Here are a few options to consider if you find yourself in a similar situation.
Look into Social Security survivor benefits
Her granddaughter likely qualifies for Social Security survivor benefits based on her mother’s work record. That monthly payment could help offset housing, food and school expenses. If the child’s father is living, he may also be required to pay child support (2).
State-level assistance programs
Linda should also explore state-level programs, such as kinship care subsidies, which many states offer to grandparents raising grandchildren (3). In addition, programs like SNAP, Medicaid, or CHIP (4) for the child and available tax credits could reduce out-of-pocket costs.
Consider delaying retirement
On the retirement side, working a few more years, even part-time, could make a big difference. Delaying Social Security until 67 or even 70 would permanently increase her monthly benefit. Additional working years would also allow her savings to grow for longer, reducing the number of years she needs to support both of them.
Lean on your village
You can also look to your community for support to help lower expenses. Consider joining neighbourhood buy-nothing groups, where little-used hand-me-downs may be offered or seeking out child care arrangements through friends or other trusted and vetted people in your social circle.
The reality is Linda may need to adjust her timeline, but she likely doesn’t need to work forever. With survivor benefits, potential child support, public assistance and a modest extension of her career, Linda can create a new plan that supports both her granddaughter and her own long-term security.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
SoFI Learn (1); Social Security Administration (2); Cuyahoga County Health and Human Services (3); Medicaid (4)
You May Also Like
- Turning 50 with $0 saved for retirement? Most people don’t realize they’re actually just entering their prime earning decade. Here are 6 ways to catch up fast
- Inside a $1B real estate fund offering access to thousands of income-producing rental properties — with flexible minimums starting at $10
- Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
- Here are 5 easy ways to own multiple properties like Bezos and Beyoncé. You can start with $10 (and no, you don’t have to manage a single thing)
Danielle is a personal finance writer based in Ohio. Her work has appeared in numerous publications including Motley Fool and Business Insider. She believes financial literacy key to helping people build a life they love.
