Couples Retirement Planning – Do it together

by Kristina on March 25, 2013 · 7 comments

Good morning Dinks.  One of the main goals that we all have is to plan for retirement. We take on spending fasts, we find a second income and we live on a budget all so that we can save for retirement.  If you aren’t spending your money now then you must be saving it for later.

Do you and your spouse share the same retirement goals?

Saving money for your retirement is just not enough, it takes planning. Saving money is a good start but you have to calculate how much you have to save, what age you want to retire and how much money you need in each year during retirement to support the lifestyle that you want to have.

Maybe you and your spouse plan to retire at exactly the same time, but this is rarely the case.  When I was working as a financial planner in a bank branch very often one spouse retired before the other and that means that one spouse was at home all day while the other was still at work. If you and your spouse don’t retire at the same time, what will you do all day if you are home alone?

Retirement is a great time to have the freedom and the lifestyle that you haven’t yet experienced.  Maybe you want to take up a hobby, volunteer your time or move to a warmer climate.  It’s important to talk with your spouse about your retirement plans to make sure that you are both working (and saving) towards the same goals.

What is your secret for saving for retirement?

I am sorry to say this but it’s true; a lot of people don’t save for retirement. There are so many short term goals that people want to achieve before retirement that they don’t focus on their long term goals.

Some people don’t save for the long term because they expect their family and the government to pay for their retirement. Some people feel that they want to enjoy their hard earned money now and therefore they don’t worry about saving for retirement. But the truth is that no one will help us achieve our goals except ourselves.

How much money you need to save for retirement depends on the lifestyle that you want to have during retirement and the income that you will need to support your lifestyle.  Starting to plan for retirement at a young age allows us to save a smaller amount of money each month as we save over the long term.  If you start saving for retirement at a later age you will have to save more money each month in order to achieve the retirement that you want and some of us can’t afford to do that.

I don’t necessarily save any of my own money for retirement.  I have other goals that I want to achieve.  I take advantage of my employer pension plan and my employer stock ownership plan for my retirement savings.  I also contribute my annual bonus into my retirement savings account; this helps me save for retirement without spending any of my own money.


Photo by uberculture

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{ 2 comments… read them below or add one }

1 carly March 25, 2013 at 10:49 am

Communication is always important with your significant other about retirement and everything else. The reality is that most people just didn’t think about retirement in their 20s and 30s and now find themselves in trouble. Retirement planning is a long term commitment. the key is to start saving early and do it consistently. I recently came across a new retirement site that covers these issues and also many other retirement related topics like health/exercise, retirement locations, hobbies and more. Worth checking out.

2 William @ Bite the Bullet March 25, 2013 at 11:53 am

Great post! My wife and I are retired now, but when we were planning this years back, something occurred to me that not too many people talk about: there is a definite difference between saving for retirement and investing for retirement. It may be semantics for some, but what I discovered in ourselves, as well as other folks we talked to, is this:

Saving is more of “let’s squeeze some money from our spending and set it aside for the future.”

Investing is more of “okay, now what exactly are we going to do with this money we set aside for the future?”

Many couples, DINKs and otherwise, find it (relatively) easy to agree on the saving part. Any responsible person understands the need to provide for the future.

The investing part, though, is something else. This is where differences emerge quickly. In our case, my wife is a lot more conservative and I am. She’d be happy to let the money sit in a savings account and earn 0.000001% interest. It’s safe and liquid, that’s what’s important to her.

To me, earning a decent return is more important. After all, when you retire, what are you going to do? Draw out all your principal, because there for sure will be nothing else? Or do you take some risk in order to get a return you can live off without touching the principal?

That’s where, as Carly says, communication is vital.

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