Does your spouse play an active or a passive role in retirement planning? And even if you’re both actively planning, does your spouse know everything he or she needs to know?
By not explaining the kinds of investments you have, the intricacies of your retirement plans and how you plan to structure your retirement income, you are doing your spouse a disservice. A retirement plan could unravel if the more financially astute spouse dies or becomes incapacitated and the other spouse is not prepared to take over. Don’t you want to leave your spouse prepared?
Here are some pre- and post-retirement basics that you and your spouse should discuss — at any age:
- Discuss your desired retirement age and goals so you can be clear about each other’s expectations.
- Make sure that each spouse has his or her own retirement plan or account. The benefits are many for both of you to be saving for the future.
- Keep your beneficiary designations up-to-date — on your retirement accounts, bank accounts and any other financial vehicles.
- Get a new will or update your existing one. The American Bar Association estimates that 40% to 60% of couples do not have a will. This oversight could cost thousands of dollars in probate costs.
- Create or buy a notebook to organize your financial accounts. It’s a simple concept that takes a few hours, but many couples overlook the benefits of keeping their information together and accessible. Be sure to include the following:
- Assets. This covers retirement accounts and investments and the amounts, owners and locations, such as banks and brokerage firms. Also include information on real estate holdings, their worth and the beneficiaries. Record a schedule of payments from annuities and online account information, too.
- Liabilities. Record your debts, such as a mortgage and car loans. Include the start date, the term of the loan, the interest rate, the size of monthly payments and when they are due, and the balance. You’ll want to also note the telephone numbers and mailing addresses for any lenders.
- Insurance. List all policies, including medical, life, homeowners and disability. Include premiums and their due dates.
- Estate plan. Indicate the location of wills, trusts, powers of attorney and advanced medical directives, as well as contact information for the estate lawyer, executors and trustees.
- Other relevant information. Note the location of the safe deposit box and keys and the contact information for any advisors. Include Social Security statements, tax returns, birth certificates and a description of pension benefits. Record any monthly income. List the monthly bills and whether they are paid automatically, online or by check.
GuideStone’s website offers many helpful calculators and other tools on how to invest and other general financial topics. These can be a great starting spot to help both you and your spouse better understand your investments and decisions related to your finances.
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