Retiring With Your Spouse? Here’s What to Know

How well do you know your spouse? It may seem like a silly question, especially if you and your partner have been together a long time. However, during your years together, you may have never touched on your collective retirement plans. Retirement brings significant changes in identity, daily routines, and financial dynamics. A successful joint retirement strategy relies on open and honest communication between couples. Here are some important topics of discussion before transitioning to this new phase of life:

Establish a Retirement Timeline

Couples should talk about when to retire. Is retiring at the same time an option? Are there potential financial advantages to staggering retirement timing? Does one partner wish to retire early or continue working? In 2024, the average retirement age in the United States was 64, according to Newsweek, an increase from previous years due to longer life expectancy and adjustments to Social Security benefits. However, unforeseen health issues, job loss, or other factors can unexpectedly force retirement. By having early conversations, couples can prepare for what they want and devise a plan B should they need it.

Sync Your Retirement Vision

Communicating retirement aspirations, including location, lifestyle, and activities, can help couples fashion a unified plan.  Where to live is a critical discussion for setting expectations, as one partner may want to move to a different climate zone while the other may want to move closer to family.  Does travel fit into the plan?  Does working in some capacity appeal to one or both partners?  Coming together on these matters enables couples to develop a strategy for accomplishing individual and collective goals.

Retirement alters home and relationship dynamics, whether a couple retires at the same time or separately. Couples should consider how their lives might change if one spouse retires while the other continues working. Will it cause resentment or frustration for one spouse to enjoy retirement freedoms while the other remains tied to their career? Will one partner feel more responsible for household chores? If spouses retire together, will they feel overwhelmed by having too much time with one another? Do their retirement plans align well? 

These essential conversations can strengthen a couple’s relationship while helping them mentally and emotionally prepare for life together and apart in retirement.

Understand One Another’s Financial Perspectives

Adjusting to the financial changes that occur during the transition from career to retirement life can be challenging, especially if spouses have differing attitudes regarding money and how to spend it.  Whether for travel, dining out, entertainment, investing in a hobby, or supporting children or grandchildren with education or home costs, being upfront about financial priorities is the best way to foster mutual understanding and prevent conflict.

Discuss Social Security and Financial Strategies

With twice the Social Security benefit per household, couples should determine the most advantageous time for each spouse to claim. For those born in 1960 or later, the full retirement age (FRA) for Social Security benefits is 67.  Those who claim at the earliest opportunity, age 62,  receive a reduced monthly rate for life. Conversely, age 70 yields the greatest monthly benefits.  Health, life expectancy, other income sources, and age of each individual are among the considerations for determining when to collect. It may make sense for one spouse to collect early and one to wait, or for both to wait for FRA. A financial advisor can help couples weigh their options to find the ideal time to claim for their situation.

Additionally, as retirement approaches, couples should coordinate their contributions to their retirement accounts to maximize employer contributions and returns. Research from MIT Sloan found that couples who fail to do this miss out on potential gains. The study found that one in four couples could have received up to $682 more per year through coordinated employer matching with their spouse.  Couples should consider which spouse’s plan presents the most financial benefit and contribute as much as possible to that account rather than contributing individually to separate accounts. A financial advisor can help couples distill the information to make the best move.

Address Financial Concerns

Finally, couples should work together to identify financial problem areas, including debts, investment risks, and financial obligations.  With the help of an advisor, couples can explore solutions to reduce debt, devise strategies for building wealth, and avoid unexpected challenges for an improved economic position.

Frank and honest dialogue is the key to reinforcing relationship bonds and ensuring a more secure and fulfilling retirement.  An SHP Financial advisor can help with the rest, guiding couples through the planning process and arming them with tax, Social Security, and investment strategies to protect and grow their wealth.  Schedule a complimentary review today to plan your retirement journey together.