Do you remember what the abbreviation IRA stands for? It’s an individual retirement account—but of course, for many of us, there’s nothing “individual” about retirement planning. Often, as we plan for our retirement we plan it as couples. Certainly, if you plan on spending your retirement with a spouse or significant other, it’s smart to do your retirement planning in tandem.
What does this look like, exactly? Start by ensuring that you’re both meeting with a financial planner together. Make it clear that you’re planning to enjoy your post-career years together, and that you want your retirement accounts to share a unified purpose.
Set Goals as a Couple
Even before you sit down to meet with an advisor, though, it’s smart to talk together with your partner, ensuring you’re both on the same page. Have a basic plan in mind—where you’ll live, what you’ll do, and what kind of lifestyle you hope to have once you retire.
Getting on the same page can help illuminate questions like how much you need to save, and which account types are best for your retirement savings goals.
Choose the Right Accounts
Speaking of which, thinking through where you’ll save is important. One partner may have an employer who offers a full match on 401(k) contributions—and if so, it’s worth thinking about making that a primary savings vehicle.
More often, though, each partner will want to consider having an individual retirement account—either a traditional or a Roth IRA. Think it over, and get input from your financial advisor.
Think Beyond Retirement Accounts
Retirement planning isn’t just about your IRAs and 401(k)s, however. It also encompasses legacy planning. The last thing you want is to inadvertently leave everything you have to an ex-spouse or former partner; ensuring your life insurance beneficiaries and your will are up to date is an important part of the retirement planning process.
Along those same lines of looking beyond retirement accounts, you and your spouse will want to plan for worst-case scenarios—including the possibility that one of you will need long-term medical care or disability care. Augmenting your retirement planning with various insurance products can be smart.
Above all, though, make sure you’re regularly talking about your shared retirement plan, alongside your financial advisor. Start the conversation today by contacting the advisors at Stonepath Wealth Management.