Before you got married, you probably discussed where you would like to live, whether you would like to have children, and general aspirations for the future.
Before buying a home, you and your spouse were discussing things like where would be best and what size house you wanted to buy.
It would be great if we could discuss the philosophy of discipline, educational goals, roles and responsibilities in raising a child before the child is born.
As retirement approaches, the big conversation isn’t over. Retirement is another big life transition for her, and it requires deep alignment on important topics.
bad news? A study by Fidelity Investments found that disagreements about retirement goals are common. About 50% of couples report disagreeing on when to retire and how much to save. Couples also often disagree about investment risks and how much is wise to spend.
Good news? With so much to discuss, conversations about money can be a very difficult topic, but couples who are good communicators are more likely to:
- Expecting a comfortable life in old age
- Rate your financial health as very good or very good
- Say money isn’t the biggest problem in relationships
Here are nine things to discuss with your spouse before you retire. Let’s start with the easy ones.
1. What do you want to do when you retire?
Many people don’t discuss or think about their long-term goals and aspirations, let alone what their spouse wants to do.
It’s perfectly fine for one spouse to follow the lead of the other. It’s certainly possible that your spouse took up golf because they played, or that they found a way to love camping because they crave the outdoors.
However, it’s good to sit down, share, and prioritize as a couple what you really want during this time in your life. Here are some resources to help you figure this out.
You don’t have to have the same goals for how you want to spend your time in retirement, but your financial plans should be made to accommodate what you both want.
2. When will you retire?
It is not uncommon for one spouse to want to retire long before another. In fact, less than 20% of all couples quit their jobs in the same year. However, the stress of marriage should be ignored, and both parties should participate in the financial strain that retirement can bring.
“Research shows that marital stress increases in the first two years after retirement, especially if the husband is the first to retire. When the structure of work disappears, unsolved problems surface,” said social historian Stephanie Koontz. AARP.
The issue of free time discrepancies is not easily dealt with, but if you have discussed retirement dates and agreed on an overall plan, you can prepare for them.
When you retire (and how long an individual lives) is a factor that will have a significant impact on your lifetime financial health.
Making sure you and your spouse understand and accept the implications of an early or late retirement date are key points to fully understanding and negotiating. Few people fully understand what it takes to According to a Fidelity survey, 52% of spouses don’t know how much they’ll need to save to maintain their current lifestyle after retirement. Still, 77% expect to live comfortably in retirement.
NewRetirement Retirement Planner makes it easy to see how much you need at different retirement ages. And find alternative ways and compromises to achieve your goals. (If you’re not using NewRetirement, be sure to use a retirement calculator designed for couples—many online tools don’t accommodate inputs unique to each spouse.)
Working with a financial advisor is another option. Work with NewRetirement Advisors’ expert CERTIFIED FINANCIAL PLANNER™ to identify and achieve mutual and personal goals. Book a Free Discovery Session Evaluate how fee-only advice can help you plan for the future.
3. Where would you like to live?
Have you ever dreamed of living in a beach shack? Close to grandchildren? A big city apartment? Are there any other places than where you are now? Maybe you want to keep still. Does your partner know about these dreams?
Retirement is a truly unique opportunity to uproot your life and live it the way you’ve always wanted to. can have a large impact on
The point is, you need to discuss your goals and understand what each of you wants. Then try different housing scenarios (downsizing, upsizing, reversing her mortgage, etc.) in the New Retirement Planner.
4. What roles and responsibilities are required in the event of a long-term care event?
No one wants to think or discuss the possibility of a long-term care event.
But the reality is that they are more likely to experience events such as stroke, diabetes, or simple old age and will need caregiving help.42% of people over the age of 65 need long-term care, or plan to need it, and neither Medicare nor Medicare Supplement covers the cost of these services, either at home or in a nursing home.
Without a clear plan, the burden of your caregiving will fall on your spouse. Many people feel honored to care for their loved ones, but you may want to clarify your thoughts on this subject and budget appropriately. Also, what happens to your remaining spouse after one of you dies? What are the plans of the surviving partners?
Explore 10 alternatives to long-term care insurance.
5. Discuss overall retirement financial planning to enjoy retirement with your spouse
According to Hearts & Wallets research, only 35% of couples actively plan retirement together. This is unfortunate because money issues are probably one of the most important solutions.Author Terry Orbach 5 easy steps to take your marriage from good to great He told Money Magazine:
If you’re retired and living on constant resources for 20 to 30 years, your money problem becomes even more acute. After discussing what each of you wants at this time in your life, you should dig into the details and see if each of your finances allows you to do what you want.
When you leave your company, you should review all your financial details.
When will you start Social Security?
How much do you want to spend and how will that change over time?
What kind of savings do you have?
Do you have life insurance?
What kind of health insurance?
how much debt?
An online retirement planning tool like NewRetirement Planner is a great way to encourage meaningful discussions about finances in an organized and sober way. Engage in a joint planning session as the ideal way to get the two of you on the same page. A good calculator, like the Retirement Planning Calculator, will ask you important questions and guide you through the process. Schedule a few hours with your spouse and look up the calculator as a couple.
Communicate clearly and be prepared to compromise fairly.
As part of your overall retirement financial planning, you should agree on some basic principles and values that govern your retirement finances.
“Even in the best relationships, money can stir up intense emotions that complicate retirement decisions,” says Dorian Mintzer, co-author of The Couple’s Retirement Puzzle.
Each of you may have different upbringings and experiences that shape your relationship with money, risk, planning, and other topics related to how you manage your finances.
You may be able to have more productive conversations with your spouse, as well as your own financial values, experiences, and money personality type.
Some people are willing to take more risks with their money than others. As a couple, you have to agree on how much you can afford to lose.
Do you want something like an annuity to guarantee you an adequate retirement income? Or do you want nothing to happen to financial markets that force you to live below your desired lifestyle?
There are many people who can’t stop working even if they have debt. If your spouse is one and you aren’t, what do you do?
How do couples deal with unexpected expenses such as aging parents or children needing money? Traffic accident?
One of you may know more about personal finance than the other. However, this only complicates planning. Because it can feel like each one speaks a different language.
When you were working, your monthly expenses were allowed to flow more freely than they did when you retired. Some people are naturally good at this, while others take a more liberal approach to spending. If you and your partner don’t have the same budgeting style, it can become unwieldy and stressful.
To help answer some of these core and complex questions, we might, again, take a look at a retirement calculator that allows you to see the immediate and long-term impact of each perspective.
You may also meet with a financial advisor to help you navigate these issues and make compromises that make sense and feel right for each of you.
7. How often do you review and update the plan?
The economy is always in flux. Hardly a day goes by without disturbing headlines about the stock market, inflation, taxes, health care costs, the collapse of Social Security, and more. Never mind how your own personal situation changes.
Therefore, it’s important that the couple sit down regularly, at least quarterly, to discuss and update their overall retirement and estate plans.
The NewRetirement Retirement Calculator is one of the only tools that saves information. So you can easily log in to see the results together and try out ways to improve your plan.
It’s not enough to just plan enough money to sustain the lifestyle you want. After one of you dies, you need to make sure your surviving spouse is comfortable.
Depending on the financial situation, the death of a spouse can have dramatic effects on survivors, especially regarding income.
9. Do you have an estate plan?
Retirement benefits aren’t the only thing you need. You will also need to draw up a mutually agreed estate plan.
- If you’re wealthy enough, should you agree on what to leave to whom? It’s not uncommon for one partner to be unaware of what the other has promised. Retirement is a good time to get on the same page.
- Do you have and understand each other’s advance directives? Advance directives are usually living wills and medical powers of attorney that tell you how you want to get care if you become disabled. A document that defines
- Will you be each other’s financial powers of attorney? Or do you assign an outside person to serve each of you?
- Have you documented all the details of your life that your spouse would need if you were incapacitated or died?
- funeral wishes
- All numbers and passwords for all accounts, including mortgages, brokerages, banks, and insurance.
- Location of official documents such as social security cards, marriage certificates, etc.
- List of all your medicines and doctors
- address book of friends and family
- Please ensure that all beneficiary designations are up to date.
Fidelity research shows that couples who work with a financial advisor are more likely to agree on their retirement vision, find it easier to start conversations about money, and feel more confident about their financial health I know
If you’re struggling to get on the same page as your spouse, an advisor may be able to help. NewRetirement Advisors allows you to work with Certified Financial Planner™ professionals to identify and reach your goals.details or Set up a free discovery session.
