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7 Biggest Mistakes Couples Make in Retirement Planning
Family Finance

7 Biggest Mistakes Couples Make in Retirement Planning

Along with the obvious benefits of being in a loving relationship, being a couple provides you with someone to rely on for assistance with life's responsibilities.

It is vital that couples approach retirement planning differently than single people. Making retirement decisions with the same objective in mind allows your money to last longer and boosts retirement security for both of you.

Retirement planning is tricky. Making plans with a spouse or partner, on the other hand, may seem easier but it’s not.

According to a NerdWallet study, when it comes to planning for their golden years, an alarming number of normally successful couples struggle to communicate and strategise effectively.

There are several cases of long-married couples meeting with a financial advisor for the first time and realising that one wants to retire in the city and the other wants to retire upcountry. 

Bryan Hoover, a financial advisor of Fragasso Financial Advisors argues that financial planning for married couples requires a decent level of conversation and honesty. If not, a variety of things can be clearly disruptive.

Here are seven major planning mistakes that couples make when planning for retirement.
Read Also: Planning for Retirement: Key Factors to Consider

1. Failing to Set Expectations

What are your plans for retirement? Long days spent at home with family, travelling to new places, or just sitting at home reading books and catching up with all the TV series you missed while hard on the grind? Do you know what your partner thinks about your options?

When a couple reaches retirement age, they have usually worked through the majority of life's problems together, such as the early stages of marriage, raising children, and paying off debt. Retirement planning may have been put on wait as a result of all of these circumstances, and it is common for people to be unaware of what their partner expects. 

To avoid emotional and financial problems, couples should freely discuss their goals for life after retirement. If one partner intends to travel, more funds should be set aside for this to be feasible. To avoid conflict, new boundaries should also be discussed to accommodate all of the expectations each one has.

Read Also: Financial Goals to Set For Your Family

2. Viewing it as My Money/Your Money

Many couples have mental models of "my money is money" and "your money is yours/ours." 

While one spouse may opt to invest their retirement assets more aggressively, the other spouse may not. Each year, one spouse may contribute the maximum amount to their retirement accounts while the other contributes only a little amount.

There are genuine occasions in which one of the couples may be earning way less than the other, but most couples will fare better by adopting a household viewpoint while preparing for retirement.

What if your retirement plan, for example, provides excellent fixed account options while your spouse's plan provides low-cost mutual fund investment options? Working as a family may yield greater results for both of you than selecting different investment options independently.

Read Also: Yours, Mine, Ours? How Couples Can Manage Money

3. Not Having a Plan B To Deal With Forced/Early Retirement

Many people in their 50s and older believe that they will continue to work at their current employment until they reach retirement age, but these plans frequently fail. According to statistics, the risk of retiring earlier than expected is far greater than most people actually believe.

In addition to downsizing and job loss, forced retirement is common as people get older and face unforeseen health problems, disabilities, or a large number of family obligations.

Forced or early retirement of one spouse may jeopardise the financial security of couples that rely on two income streams to get through their day-to-day lives and retirement. Likewise for individuals who are retired and would like to return to the workforce but are unable to.

Even if you have saved some money throughout your career and are eligible for a sizable package, you may find yourself in need of additional income to cover recurring needs or to maintain the type of retirement lifestyle you desire.

As a result, you must have a backup plan in place in case things do not go as planned. You can start a side hustle to generate numerous streams of revenue for yourself and your family.

Read Also: What to Do If You Lose Your Income Mid-Career?

4. Having Only One Person Handle Family Finances

Too often, one partner actively oversees the family's finances while the other relies solely on their decisions.

Couples should engage equally in retirement planning and major financial decisions. Even if you and your partner don't have the same spending habits, you should still discuss where you want to spend the majority of your money.

Despite how uncomfortable it is, one of the best things you can do for your relationship is to create the groundwork for open and honest financial communication as soon as possible. 

Financial infidelity can cause major problems - it is a very well established fact that money issues are one of the biggest causes of divorce.

A money date night is an excellent method to create the groundwork for honest and nonjudgmental dialogue. Once a week, or month talk about your finances with a friend or family member, including the steps you're taking to retire. 

The crucial thing is to start reaching agreements on major subjects, such as where you want to retire, even though you may not necessarily agree on every financial issue.

After you've established your goals together, you should begin tracking your finances. This isn't a technique to track every penny your partner spends, but it is a way to ensure you both have enough saved for retirement and to re-evaluate if you're having trouble. 

Read Also: 7 Things Every Woman Should Know About Family Finances 

5. Not Considering Joint Life Expectancy, Age, and Health Differences

You need to prepare for the probability that at least one of you will live longer than the other. Even though addressing life expectancy can be difficult, it is essential. The age difference between you two should be considered in your retirement planning method.

How does your planning evolve as you get older? Required minimum distributions from retirement accounts may have to begin for one of you several years before the other. Naturally, this would need the establishment of an earlier investing strategy in the portfolio.

On the other hand, according to statistics, 60% of a person's medical costs are incurred when they reach retirement age.

Health disparities matter because they influence your need for long-term care, your ability to select (and pay for) a health plan, and the activities you undertake in retirement.

Read Also: Family Health: How to Financially Prepare for Medical Costs in Retirement

6. Not Agreeing on Investment Strategy

According to Sandy Adams, a Certified Financial Planner at the Centre for Financial Planning Michigan, couples may disagree on how to invest their retirement portfolio, just as it may be difficult to decide on a new paint colour for the living room. 

As a result, it is advantageous to initiate a discussion about the overall financial strategy, including what they can afford to spend with their existing resources and how aggressive or conservative they should be in the long run. 

According to Adams, when clients are given the opportunity to evaluate their future retirement, which they may not have given much thought to, they often reach an agreement.

It's common for investors to desire to stick with their current investments. As a result, the portfolio may be under-diversified or out of date, posing risks to your investments. With good communication, you may both opt to diversify or upgrade the portfolio in order to put yourselves in a better position. 

So it is important to agree on what investment strategy you both will use to make your investments more diversified and balanced.

Read Also: 5 Investments Types Two-income Couples Should Try

7. Not Being on the Same Page Regarding Helping Relatives Financially

Most people, if not all, would want to help family members in need. But let's face it, it may be a huge financial burden, especially for those who are retired or nearing retirement.

Couples who do not discuss and agree on how much assistance they would provide for family members are more vulnerable. When a spouse agrees to pay for a child's or grandchild's entire education, and the other opts to cover just a fraction, what can you do?

How much financial support should retired or near-retired parents provide, for example, if an adult child loses their job or has a separation or divorce?

If you do not talk about these concerns and reach an agreement on a course of action, it might be a financial and emotional nightmare for everyone.


The most important lesson to learn about retirement planning with your spouse is the value of communication. It will be easier to reach your retirement objectives together if you have open and honest channels of communication between the two of you. 

Realistic and reasonable preparation may also assist you both avoid experiencing financial strain as a result of emergencies and provide greater room for error in the event that one does happen. 

Everyone hopes for a retirement that is full of leisure, laughter, and enjoyment. Why not take the necessary actions to bring it about?

Read On>> Money Conversations You Must Have With Your Partner

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Sheila Brenda Andoi is a dedicated journalist, meticulous editor, and skilled communicator with a profound passion for maternal health. Her journey in the world of media and communication has been marked by a commitment to shedding light on crucial issues. Sheila's writing not only informs but also inspires and educates

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