Planning for Retirement with a Partner

(3 Minute Read)

Planning for retirement can be confusing as it is, but when you’re married or share life with a partner, it takes on a whole new nuance. It isn’t just your own expenses and concerns you have to think about; there’s also your desire to continue supporting and caring for your partner even after you’ve both left the rat race behind. There’s also some strategies that can be used to better both partners long-term. When you and your partner are planning for your golden future, don’t forget these factors.

Retiring/Drawing Benefits Too Early

One issue that often arises for couples with an age gap is that one is ready to retire when it’s not financially responsible for the other to do so. If one person is 70 and has maxed out their personal deferred retirement credit, that doesn’t mean the younger 65-year-old should just start to stay home too. That could cause them serious financial challenges down the line, especially if the couple isn’t legally married, a status that allows Social Security benefits to be shared or deferred to mutual benefit.

Even if there isn’t an age gap, it’s important that you plan when each person will begin to withdraw from their retirement plans and Social Security benefits. Review your retirement plans and what you should expect to spend in retirement together with your advisor to make an educated decision on when each person should start withdrawing. In some cases, one person withholding from taking their benefits can mean that there is more afforded to them in the long run.

Keep Busy!

Strategies for retirement aren’t all financial. What do the two people in the relationship intend to do both together and separately to keep fulfilled and occupied after the 9-5 work life has passed by? Plan early for volunteer commitments, travel opportunities, or other things that both want out of your retirement. Staying busy can help you maintain sanity with the new-to-you free time you’ll find yourself in. Dedicating your time to hobbies and other activities can help you make your life feel more whole during retirement. This stands for both of you individually and together. The more time you spend outside of the house, the more you’ll appreciate your retirement freedom.

Failing to Plan Together

One of the biggest traps that couples often fall into is simply ignoring retirement and not planning or talking about it at all. Just because one person is on track to retire at 65 doesn’t mean the other is, or wants to be, or is even able to. Presumptions can be dangerous, especially when it comes to assuming retirement will just fall into place. Sure, your love may have weathered many tests and trials, some of them financial, but retirement age comes with its own challenges of mobility and health, even if you don’t plan to retire once you reach it.

When planning retirement with a partner, it’s important to communicate about what each wants from their retirement and how much money such a lifestyle will cost. Assets like life insurance policies that you’ve worked to build up together over the course of your relationship could be valuable ways to get cash money for a nest egg for retirement. If you’re interested in life settlements, contact us today or visit our calculator to see if you qualify.

Case Study: Kent and Julie have recently retired and realized that they no longer needed the $500k life insurance policy Kent bought many years ago as replacement income for Julie in case he was not around. Kent wants to set up a college fund for the grandkids but Julie took an early retirement due to health issues and the medical bills have been piling up. Kent discovered he could sell his life insurance policy and received $50k to setup a college fund for their grandchildren.

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