This paper explores the policy challenges generated by the growing post-retirement population in the rural areas of the Russian Federation. We investigate whether problems of the elderly can be eased by in-kind transfers. Traditional neoclassical criticisms of in-kind transfers are discussed, but found inappropriate to the unique conditions of rural Russia. We posit that rural pensions should continue to be subsidized with in-kind transfers, specifically those associated with agrarian production. Such transfers are justified on both economic and social grounds.