Retirement planning as a couple has its perks: shared goals, double the savings power, and someone cool to dream with. But double the planners also means double the opinions on when you'll retire, where you'll retire, and how you'll even get there. It makes retirement planning for couples seem less like number crunching and more like a dance in the coordination needed to align your desires, timelines, and priorities. It may come with a stumble or two, but with honest conversations, you can turn two different dreams into a seamless roadmap for your golden years.
As you organize your thoughts and ideas around retirement with your partner, here are three important questions to discuss.
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1. What should our ideal day-to-day retirement look like?
You and your spouse may have things in common (or not: opposites attract), but even mutual interests and hobbies don't guarantee an aligned retirement vision. Since you're jointly working toward the same future, it's best to start out your planning with the question, what exactly do we want from this?
Of course, you don't have to do everything together. But for the everyday things that involve both of you, getting on the same page pre-retirement is crucial. For example, where do you both want to live? Do you want to stay in the family home, downsize to a condo, or move to a new state or country? Are you both content with a low-key retirement, or will one of you have the travel bug?
Don't make any assumptions; throw it all on the table. For example, when my spouse and I did this a few years ago, we both agreed that a farmhouse in Sicily would be nothing short of amazing. But when we dug into the vision, we discovered we liked this dream for two different reasons. She wanted was a slow life by the beach ("aperitivos" and "siestas"), whereas I wanted to stay active ("farming"). The location was appealing to both, because it satisfied both of our wants, even if our day-to-day would look different. The exercise helped us align our different visions, while preventing unnecessary future conflict.
2. How will the numbers add up for our shared vision?
Once you've agreed on some retirement goals, it's time to match those dreams against your balance sheet. This means discussing how much you've saved so far, as well as talking about how much you'll need to save to support your aspirations.
To kick things off, try the 80% rule. This quick rule of thumb says you should aim to replace 80% of your pre-retirement income for each year of retirement. So, if you're pulling in $100,000 today, plan on needing about $80,000 annually in retirement, or roughly $2 million over 25 years. Keep in mind this benchmark will flex with your goals: globe-trotters may need more, for instance, while stay-at-homers in a paid-off house may need less. But it can help you put numbers on your dreams, especially if you don't know where to start.
Social Security benefits and other pension income may help chip away at your number. But don't count on it to cover everything. Depending on your plans, you'll likely need a decent amount of savings to fill the gap.
Of course, few people have the means to save $2 million in cash, but the hill is much less steep when you're investing effectively. For example, the table below shows how $7,500 in annual contributions could exceed $2 million in 40 years.
| Growing at 8% for | $7,500 Invested Annually |
|---|---|
| 5 years | $47,519 |
| 10 years | $117,341 |
| 15 years | $219,932 |
| 20 years | $370,672 |
| 25 years | $592,158 |
| 30 years | $917,594 |
| 35 years | $1,395,766 |
| 40 years | $2,098,358 |
Source: Calculations by author
An annualized growth rate of 8% over 40 years is realistic when you're investing in the stock market. You don't need to hit it big either: Investing consistently in a simple ETF or index fund can be an effective way to grow your money over long periods.
3. What's our plan for healthcare expenses?
Healthcare expenses are a not-so-fun, but super important, retirement cost to keep in check. Just consider this: A 65-year-old retiree in 2024 faces roughly $165,000 in medical expenses over retirement. Multiply that by two, and you're staring at $330,000 for a couple -- a pretty hefty chunk of change.
That figure isn't gospel, but it does signal the need for a strategy. As you're thinking about medical costs, you might want to discuss the following questions:
- Which Medicare route best fits us? Original Medicare gives you more freedom to choose providers but has higher out-of-pocket costs, while Advantage plans help cap costs but lock you into a network.
- How big should our medical emergency fund be? Between premiums, deductibles, prescriptions, dental, vision, and other out-of-pocket expenses, a cash buffer can cover surprise bills and stop you from raiding your investments too early.
- What's our long-term care strategy? Will you self-fund in-home care, purchase a long-term care policy, rely on family to step in?
They say two heads are better than one, and never is that more true than in retirement planning. The secret to doing it successfully is having candid conversations, joint number-crunching, shared goals, and an emergency stash of chocolate for those "why-does-our-budget-look-like-rollercoaster?" moments. Nail down the details together, and you'll stride into your golden years with clarity, confidence, and maybe even a little swagger.
