Ep 25: Financial Mistakes Couples Make

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Getting spouses on the same page with their retirement plan can often be a challenge. We’ll share some of the common things couples mess up when it comes to their finances and what you can do to avoid these mistakes.

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Show Notes

Money is one of the leading causes of disagreements and divorces among couples. Today we’re talking about some of the common financial mistakes couples make and how you can avoid them.

One of the biggest mistakes we see is couples who don’t have financial conversations. This is so crucial to your marriage. Sit down and talk. It could be a weekly or monthly check-in, but put some parameters in and make some compromises.

Maybe you want to put in place some spending rules. When you make large financial decisions without consulting your spouse, that’s where problems can arise. These conversations can help you determine if you have the same goals. What are you saving for? Are you on the same page?

Another mistake is making the wrong choice on how to handle the spousal benefit option on a pension. Pension planning is a big part of our process with our clients. You want to make sure your spouse is taken care of if something happens to you. You need to find out how your pension will be affected and if you have spousal survivor benefits.

One mistake you want to avoid is failing to coordinate your Social Security options. Whether one of you will wait on claiming or not will change your retirement plans. Maybe the higher earner will wait or vice versa.

Have you spoken about your retirement dreams? A lot of spouses have different ideas of what retirement will actually look like. Take a break from work before retirement and manage your days as if you were retired. It will give you an idea of what you will fill your days doing.

A lot of couples get together after they have set up their own individual retirement accounts like their 401(k)s. Make sure these are also coordinated from a tax diversification standpoint. You don’t want all of your money as a couple going into the same tax buckets.

Are you and your spouse on the same page when it comes to risk? One spouse may be more comfortable with higher-risk investments while another wants minimal risk. It’s really important to align your comfort level.

Lastly, you want to work together when it comes to your estate plan. Usually, this is a hard conversation. But not having a plan in place can be a big mistake for couples. There are strategies to help with tax planning when transferring wealth to the next generation. You and your spouse should have these conversations upfront for the health of your family’s financial future.

Listen to the full podcast or use the timestamps below to jump to a specific section.

[3:57] Conversations

[6:21] Pensions

[10:48 ] Social Security

[13:16 ] Retirement dreams

[16:04 ] 401ks, IRAs

[18:37] Risk

[21:07 ] Estate planning

Thanks for checking out this episode. We’ll talk to you again soon.

“The number one mistake is not having financial conversations.”

-Scott Sierens