Investor Education – Financial Planning
Two-career couples--who should retire first?
You and your spouse are both employed and nearing retirement age. Even if you've accumulated enough assets to allow you both to retire at the same time, however, you might not want to do so. The transition into retirement can often be difficult, and doubly so if you're both struggling through that phase simultaneously. So, who should retire first?
If one spouse is earning significantly more than the other, then it usually makes sense for that spouse to continue to work in order to maximize current income, ease the financial transition into retirement, and perhaps even increase your retirement nest egg.
But what if your incomes are relatively equal? Here are some other factors to consider:
- Pensions: If only one of you is covered by an employer pension plan, it may make sense for that person to continue to work if he or she hasn't yet maximized that pension benefit. Similarly, consider how continuing to work would impact your Social Security benefits.
- Insurance: Are either of you eligible for retiree health insurance? If so, are you required to work to a certain age to get that important coverage?
- Plans: Does one of you have specific plans for your retirement years? Perhaps you'd like to concentrate on a hobby, or spend time volunteering, or even learn a new skill? If so, consider whether that person should retire first in order to pursue those goals.
- Job satisfaction: Does one of you find working more self-fulfilling than the other? Would one of you feel more lost without your current routine?
One thing is clear--you'll need to discuss this with your spouse, preferably well ahead of time.
For more information on this topic, please contact us. At Bartlett & Co, we assist high net worth individuals and their families in defining & reaching their life goals.