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How Stay-at-Home Spouses Should Prepare for Retirement

When only one spouse works, the stay-at-home spouse may feel less responsible for preparing for retirement. But marriage is a 50/50 partnership, even when only one spouse earns an income, and retirement planning is about more than money.

From the wedding until the last day of full-time work, both partners should be involved with retirement planning. Here are some tips for stay-at-home spouses to prepare for retirement.

Actively participate in retirement planning. The primary earner in a relationship often takes the lead on retirement money matters, while the stay-at-home spouse may be in the dark. Instead, both partners should understand the financial mechanics of how to live off savings and make their money last, especially in case one partner passes away or becomes unable to manage the money.

To properly prepare, couples should have regular conversations about their desired retirement lifestyle and how they'll reach their savings goals. The more aligned the couple's retirement vision, the better the chances of achieving it.

[See: 10 Ways to Help Your Marriage Survive Retirement.]

Household management is money management. Stay-at-home spouses often carry the responsibilities of household management and primary child caregiver. Both objectives have variable costs, which can break a monthly budget. Household management is, in many ways, money management masked as what might feel like a career in hospitality.

Overspending on family clothing, gourmet foods and expensive furniture can add up and detract from your retirement nest egg. Carefully consider all household expenses against the opportunity cost of an earlier or more comfortable retirement.

Contribute to a spousal IRA. Prior to the Kay Bailey Hutchison Spousal IRA law, stay-at-home spouses could not contribute to IRAs. The 1996 provision to the U.S. tax code enabled non-working spouses to contribute to tax-advantaged investment accounts. The spousal IRA is now a way for married couples to double their IRA contributions. A spousal IRA can be opened as a traditional tax-deferred account or pre-tax Roth option. Utilize this retirement planning tool to help maximize your annual tax savings.

Identify savings opportunities. Some stay-at-home spouses are the primary managers of the family finances. In addition to keeping household costs low, focus on identifying savings opportunities that can significantly increase monthly cash flow.

Aim to eliminate recurring expenses you don't need, such as unused TV services, and to pay off or refinance high interest debt. You can also make lifestyle choices that don't require large annual dues or monthly fees. Identifying expenses you can cut allows you to put more savings away for retirement and lowers ongoing living expenses and lifestyle needs, which could lead to an earlier retirement.

[See: 10 Tips to Boost Your IRA Balance.]

Earn extra income. Stay-at-home parents of young kids have little free time. But as the kids age, there may be opportunities to begin earning extra money.

You could get a part-time job while the kids are in school. Technology and the internet have also opened up a wide range of work from home opportunities. Be sure to set aside a portion of earnings for long-term needs and max out tax advantaged accounts first. Try to avoid the temptation to spend the extra income on yourself as a reward.

Raise financially literate children. Halting a career to raise kids is one of life's most difficult and selfless decisions. Good parenting is about raising healthy, considerate and loving children who become independent adults. Financial literacy is a big part of that. Start teaching kids early about smart money decisions and be a financial role model they can emulate. Financially savvy kids become responsible adults that won't need to rely on Mom and Dad for support.

Prepare for more time together. On the first day after retirement, a comfortable daily routine may feel interrupted by someone with newfound free time on their hands. The stay-at-home spouse will need to adjust to a partner being around more often.

As your spouse enters retirement, make sure to maintain the parts of your personal routine that you enjoy most, but make time for companionship too. Communicate with your partner before retirement that you won't be there to entertain them each day. They will need to develop their own routine.

[Read: 7 Tips for Thriving When One Spouse Retires.]

Maintain good health. Nothing derails an active retirement more than chronic health issues. It's harder to reverse an unhealthy lifestyle than it is to stay in shape over many years. You don't need to train for marathons and become a vegan to be healthy.

For exercise, choose simple activities you enjoy to stay motivated. Go for regular walks in your neighborhood, swim laps at the local pool or join a reasonably priced gym. Prepare healthy meals at home instead of consuming restaurant or take-out food. Focusing on your health can help keep your medical costs down and increase your longevity. Without your health, you won't enjoy retirement to its fullest.

Craig Stephens is a blogger at Retire Before Dad.

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