When couples plan their retirement, they should take into account a simple fact of life: On average, women live longer than men. A woman who reaches 50 is likely to live to 83, while a man who reaches 50 is likely to live only to 79. A healthy 65-year-old woman will live, on average, to age 85, while the typical 65-year-old man will live, on average, to 82. This basic principle is important when it comes to retirement planning.
While unpleasant to think about, one partner will move on before the other. This affects many integral parts of financial planning, including pensions and Social Security. Retirement-minded couples need to ensure they will have assets in place to help make up gaps in income once one spouse dies. To avoid any such problems, as they plan for retirement, most couples will need to make sure they choose the 100% spousal continuation option for their pensions. By doing this, it will help the surviving spouse to continue retirement at the same comfort level.
Early discussions to have
All of this underscores why both husbands and wives should be kept in the loop about retirement planning. Even if one half of a married couple is far more engaged on financial matters, both spouses need to be on the same page when it comes to their assets. Couples should talk about:
- How much risk they are comfortable with.
- How they want their portfolios allocated.
- What their wealth should be used for.
You'd be surprised how much you will learn about your spouse when you talk about investments and retirement planning.
As is so often the case in any successful and happy marriage, communication is key. Of course, one key to ensuring healthy communications is making the wife part of the decision-making process. Too often, it seems financial professionals and husbands discount women's opinions when it comes to financial planning. From my own experiences holding financial and retirement-planning workshops, I find women are very engaged when it comes to money management. They don't tend to get tripped up over their pride like some men do and aren't afraid to admit they don't know everything.
Certainly, married women have just as much at stake in their retirements as their husbands do and should always be included in retirement decisions. Even if they aren't in charge of the decisions, married women need to understand how their retirement plans are being crafted and be comfortable with it.
Simply put, we're no longer in the 1950s. Women bring in a great deal of the income and retirement assets. It's a far different world than the one many of us were born into. These days, more female students graduate from college than their male counterparts. That alone is going to make retirement planning far different than it was only a few decades ago. It's also a good reminder to make sure both husband and wife are included in retirement planning.
Finding the help that fits
As they look for advisers to help them map out their retirements, couples should also continue to be on the same page. Both spouses should be comfortable and trust their financial professionals. For their part, advisers need to be able to meet and work with both spouses, including being able to work with both husband and wife individually, if needed. All of this being the case, financial professionals need to ensure they reach out to both partners as they plan their retirements. Certainly, financial professionals should always reach out to retirement-minded women who will face unique problems, especially as they are more likely to be the surviving spouse.
Retirement is one of the most important stages in life for couples. A successful retirement needs a good deal of thought and planning. Just like other parts of married life -- getting established, buying a home and raising children -- couples should always be aware of retirement plans and be comfortable with them.
Gregory Ricks is the founder and CEO of Gregory Ricks & Associates, a Registered Investment Advisory Firm, as well as an insurance professional and radio host of "Winning at Life." He is also the founder of Total Wealth Authority, a team of outside financial, tax and estate planning professionals.
Kevin Derby contributed to this piece.
Copyright 2017 The Kiplinger Washington Editors