Five Retirement Questions to Ask Your Spouse PC1335-Digital

Five Retirement Questions to Ask Your Spouse PC1335-Digital

RETIREMENT PLANNING

RETIREMENT QUESTIONS

Five Retirement Questions to Ask Your Spouse

The idea of retirement can generate a number of different emotions, including anxiety about post-employment life and excitement for the experiences to come. Unfortunately, it is rarely the impetus for a conversation between spouses. Married couples often discuss big issues such as whether to have children or when to make a major purchase, but fail to discuss life after work. A recent study confirms what many financial advisors already know: Couples aren’t taking the time to discuss and plan for later in life. The survey showed that 41% of

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RETIREMENT PLANNING

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couples disagreed when asked whether at least one partner would work in retirement, and 35% differed when asked about each other’s expected retirement age. Only 38% said they worked together on financial planning for later life. 1 The key to a secure – and enjoyable – retirement is to plan ahead. Discuss the following five questions with your spouse today to prepare for an enjoyable retirement. 1. DO WE WANT TO FULLY RETIRE – AND IF SO, WHEN? Retirement today can look very different than it did for prior generations, who generally left the workforce between ages 62 and 65. Today, many people continue to work in some capacity after traditional retirement – some out of financial necessity, others because they enjoy their careers or wish to start new ones. Couples should ask themselves why they want to retire. Retirement should not be about running away from something; rather it should be about looking forward to something. 2. WHAT IS OUR VISION OF RETIREMENT – AND DO WE SHARE THE SAME VISION? Some people think of retirement as the end of work. Others

RETIREMENT PLANNING

RETIREMENT QUESTIONS

view it as the beginning of new opportunities, a chance to finally do something they’ve always wanted to. Couples need to clearly understand what retirement will look like for each individual and for the two as a unit. Discuss what is most important to you, and seek to understand what is most important to your spouse. Make sure your expectations for retirement follow a compatible path. Identify where your goals diverge. 3. ARE OUR AFFAIRS IN ORDER SHOULD SOMETHING HAPPEN TO ONE OF US? Only 40% of adults in the U.S. have a will, according to AARP. 2 Without these documents in place, your spouse may not know your wishes in the event of incapacitation or how to access your accounts when you pass away. It’s important for both spouses to know what assets are available and be able to access them easily. Simply compiling the contact information – names, phone numbers and account numbers – for each account is a great start. The next step is to get together with your financial advisor or estate planner to update beneficiaries on accounts, create a comprehensive list of assets and note

RETIREMENT PLANNING

RETIREMENT QUESTIONS

where important documents are stored. These steps can help alleviate surprises should something unforeseen happen. 4. WHERE DO WE WANT TO RETIRE? Many people find that without work and family obligations tying them to their location, retirement is the time to finally explore new places either by moving or traveling. You may think that your spouse will naturally feel this way if you do, but maybe he or she is just excited to settle into a quiet life in your home. Do you and your spouse agree on the importance of living near family and loved ones? If your children have moved away from home, do you want to move to be closer to them? Find out if your priorities are similar. 5. HOW MUCH MONEY WILL WE NEED TO SUPPORT OUR LIFESTYLE IN RETIREMENT? Only 55% of surveyed workers say they and/or their spouse have tried to calculate how much money they will need to live comfortably in retirement, according to the Employee Benefit Research Institute. 3 Don’t think that building your nest egg stops at retirement. The likelihood that a healthy

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RETIREMENT QUESTIONS

couple in their 50s can have at least one spouse live until their mid-80s means you may need to continue to grow your assets for 30 years. With such a long time in retirement, you should prepare for the very real

ACCORDING TO THE SOCIETY OF ACTUARIES, A 65-YEAR-OLD MAN HAS A 41% CHANCE OF LIVING ANOTHER 18 YEARS AND A 20% CHANCE OF LIVING ANOTHER 26 YEARS. 4

possibility of a significant market decline during your golden years. How would a market decline affect your lifestyle? Could you change your spending habits? Would one or both of you go back to work? Being on the same page is critical to avoid surprises and to make the most of your financial situation. SET ASIDE TIME TO TALK Discuss your plans and dreams for retirement early and often because things change. Giving retirement the proper attention can help you negotiate compromises for disparities and prepare for an enjoyable retirement with your spouse. Contact a Commerce Trust advisor to learn more about the important topics to consider.

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RETIREMENT QUESTIONS

1. 2013 Fidelity Investments Couples Retirement Study. Fidelity Investments Institutional Services Company, Inc. (2013). 2. Walls, Barbranda Lumpkins. “Survey: 60% of Americans Lack Will or Estate Planning.” AARP, 24 Feb. 2017, www.aarp. org/money/investing/info-2017/half-of-adults-do-not-have-wills.html. 3. Employee Benefit Research Institute and Greenwald & Associates, 2018 Retirement Confidence Survey. 4. Wohlner, Roger. “Not Investing Aggressively Enough.” 20 Jobs That Will Be Replaced by Technology, 19 Dec. 2017, www.msn.com/en-us/money/retirement/9-things-not-to-do-in-retirement/ss-BBH2TJS#image=3.

Contact a Commerce Trust Advisor today to discuss what retirement means for you and your spouse. 1-855-295-7821 | commercetrustcompany.com

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