Planning for Retirement with Your Significant Other

Achieving your retirement and financial goals for yourself can be a challenging task. Then, once you add in the goals for your significant other, it can put an entirely new twist on your retirement strategy. Whether you’re newlyweds or celebrating another milestone anniversary, there are some important conversations that you may want to consider having with your spouse. With some key strategies in-place, you may find that you are able to work through most of the financial struggles that life throws at you. Here are three basic tips for you to consider when planning for retirement with your significant other.

First, it’s important that you both are on the same page. You’ll want to make an effort to truly approach retirement planning as a team. As with many things in life, we may achieve our goals in a more efficient way if we work together to accomplish them. You might want to consider saving for retirement together with your spouse. Doing so will potentially get you closer to your mutual goals. You also may want to add more to your retirement plan if your spouse doesn’t have a 401(k). If one of you work at home while the other does not, consider looking into a spousal IRA. With a spousal IRA, a working spouse can contribute to a nonworking spouse’s retirement. Also consider what your ideal retirement conditions are, such as your desired retirement age or location. If you discuss your retirement goals with your spouse, you’ll be that much closer to achieving your retirement dreams.

Second, you’ll want to make yourselves aware of how the age gap can potentially impact your retirement strategy. In some marriages, there are considerable age gaps in between the two spouses. In planning for your retirement savings, you may want to consider saving based on the younger spouse’s age. For example, if you will be 65 when your spouse is 55, it might make sense to add another 10 years of planned savings into your accounts. This idea also applies for withdrawal rates post-retirement. And, it can help you to ensure that both of your Social Security benefits are maximized. One of the best ways to maximize your social security benefits is to wait as long as possible to start collecting them. If you are able to delay your retirement even one year past the full retirement age of 66, you could potentially add 8% to your social security monthly payments.

Our third and final tip for you to consider is to space out your retirements. While it may seem ideal to retire at the same time as your spouse, it may be best to stagger out the dates that you both say goodbye to the office. When both spouses are working, there are a lot of adjustments that come with both of you retiring at the same time. The sudden stop of paychecks may financially shock the household for some time. Also, having both spouses adjusting to being home all of the time with each other may be a tall task to accomplish. It may also be an adjustment for a nonworking spouse to have their husband or wife suddenly always home. It is important to consider both the financial and emotional reasons that it might be best to stagger out retirements before making any final decisions. As with any major decisions in life, it is best to think through them thoroughly in order to make the best choices that we can.

Ultimately, it’s important for you and your significant other to collaborate early and often when planning for a secure retirement that you’ll both enjoy. A solid strategy can help you prepare and keep you grounded through retirement. CONTACT US today to request your complimentary, no obligation financial review and we’ll help you and your spouse understand the next steps you need to take to help secure an ideal retirement.