7 Financial Planning Tips for Retired Couples

Financial Planning Tips

Retirement can be a dream come true for most employees. It could mean stepping away from the hustle and bustle of corporate life and starting your journey towards years of creating more beautiful memories with your loved ones.

While some prefer a simple, quiet life after years of hard work, many retirees want to make up for the lost time by getting the thrill out of anything and everything. There’s no right or wrong way to spend your retirement, but you must prepare for all the money you’ll spend.

The easy part is to imagine how you can live your retirement years with your spouse. The hard part comes when you face the realities of financing it for the long term. One of the worst nightmares for retirees is realizing that your savings in your bank accounts aren’t enough to secure your later years worry-free.

Live life to the fullest with your significant other, whom you vowed to love for richer or poorer—preferably the former—with a secure financial plan for your retirement years. Here are seven tips for creating a financial plan you can depend on. 

7 Financial Planning Tips for Retired Couples

1. Discuss your goals and priorities 

Like anything in life, talk to your partner about goals and expectations for your retirement plan. Are you both willing to travel the world? Do you want a vacation to celebrate your retirement, or do you want to sit back, relax, and watch life unfold? Aligning what you both want with what you both have can save you the headache when budgeting your retirement finances

Besides taking note of what you want, remember to consider the necessities you need to spend on. These can include: 

  • Housing and utility bills
  • Transportation costs like commute fares or gas money 
  • Day-to-day living expenses such as grocery and clothing
  • Entertainment, including restaurant dates, movie tickets, and streaming sites

2. Consider your differences

In discussing budgeting your retirement finances, keep your individual circumstances in mind. For example, if there’s a considerable age gap between you and your partner, one may retire earlier. One may require more money from your retirement fund before the other even retires.

Healthcare costs should also be a significant factor you should consider during your financial planning. You or your spouse may have a specific health condition that requires more medicinal costs or a more extensive bill during your annual check-up. These differences may ask you to take a different approach for a more realistic budget plan.

3. Secure your funds together

One of the most significant benefits of being in a relationship is having someone to lean on—this extends to retirement planning. As you plan to spend your later years together, you should consider saving your retirement funds together. 

Combining your finances doesn’t have to be an all-or-nothing situation. You can choose to keep a separate account for personal reasons. While many factors can come into play on how much each of you should set aside for retirement, merging your finances can help you reach your retirement goals faster. Remember to strategize and have enough flexibility in your budget in emergencies.

4. Prioritize your debts 

Financial planning is a crucial part of living your golden years without worries. However, the grey clouds of debt looming over your budget can keep you up at night and cause strain in your relationship. Keep your debt payments at the top of your budget list to avoid going into your non-earning years owing money. Here are some debt obligations you’ll want to prioritize:

  • Credit card payments 
  • Car loans 
  • Mortgage 
  • Student loans 

Remember to stop racking up any more debt bills to pay. This may sound obvious to most, but some retirees tend to cover one issue with another. Taking out a new loan to pay for the loan that’s almost due in your retirement years isn’t the best idea. 

5. Make smart investments

Take advantage of the compounding power of your assets to finance your dream retirement. 

Investing can give you a new income stream without the troubles of hard labor in your retirement years. Consider diversifying your investments across different avenues to improve your profit portfolios. While one can look into investing in treasury bonds, the other can invest in the high-return opportunities of capital stock. 

Bonds are a popular investment choice for individuals looking for more stability than growth. With bonds, investors lend money to a company or the government. The borrower then has to make annual payments with a predetermined interest rate to give back the original investment by the end of a determined period.  

Many invest in stocks as their prices rise over the long term, but they also fall. Depending on your risk tolerance level, you can look into sectors with high risk but high growth potential or conservative profiles with lower gains but more stable growth. 

6. Consider downsizing

Retired couples choose to spend their later years staying in their family homes due to various reasons, primarily sentimental ones. The living room where their oldest child walked their first steps, the backyard where the kids used to run around, and the list go on. However, when the children have flown from the nest and formed their own, retirees should consider downsizing. 

If you’re lucky to have a house built in an area where the housing prices have significantly risen, consider selling your house to earn your capital. Doing this allows you to move to a quaint place with a relatively low living cost. Moving into a smaller home can save some dime on property tax, monthly Home Owner’s Association fees, and maintenance fees. 

Keep an eye out for one-story homes. Besides being easier to maintain, accessibility to every room, even in your golden years, is a must. Good for you if you’re both healthy and active today, but your later years can inevitably loosen some bones. 

Plan a Worry-Free Retirement 

It’s not uncommon for retirees to worry about outlasting their retirement funds. Be confident in living a comfortable life in your retirement years with the right financial plan to stretch out your funds for as long as needed. 

If you still have concerns, you can work with your local financial advisor to help you plan to live your retirement years without breaking the bank.