If you’re married, or in a relationship, it’s important that you include your significant other in your retirement planning. You would be amazed at how different we view our ideal retirement, such as where we’d like to travel, what sort of car we’d like to drive and how we’ll spend our money. Many couples are simply not aware of this until it’s too late.
Outlined below are the top 5 questions for you to start answering with your significant other to ensure that you’re on the same page and your retirement plans are on the right track.
1. Where and how often would you like to travel?
For some of us, an ideal vacation is a weekend stay in a nearby beachside town, while for others it’s a 6 week ‘round-the-world’ cruise. Needless to say, there is a very large difference in the cost of the two, which is why it’s important to discuss how and where you’d like to travel with your partner. This will define whether you plan to spend $2,000 on travel or $60,000 each year, which makes a big difference to how much you need to have saved by your retirement.
2. What sort of car would you like to drive?
Our vehicles can be a large expense and it’s important that you and your partner have a clear understanding of your intentions when it comes to the car you’d like to drive. Whether it’s a Mercedes that you plan to replace every 2 – 3 years, or the family car you’ve had for years that you’ll drive until the wheels fall off, ensure that you and your partner are on the same page.
3. When do you want to retire?
Do you know when your partner would like to retire? Are you planning on retiring at the same time? Will you live on one income before the two of you retire? It’s important that you have the conversation with your partner to determine how much you need to save to reach your retirement goals.
4. Where do you want to retire? Would you like to spend the whole year there?
Are you planning to return to Australia for your retirement? Or would you prefer to spend half of your year in the Bahamas and the other half in Paris..? You should have the conversation with your partner about where you would like to spend your time when you stop working, as this will impact how much you’ll spend in retirement and therefore, how much you need to save.
5. How much money would you like to donate and give away?
There are only three things that we can do with our money; we can spend it, we can save it, and we can give it away. For many, there is no greater joy than giving your money away to worthwhile causes that are important to you. It could be donating to find a cure for cystic fibrosis, or wanting to pay for your grandchildren to go to university. Whatever your passion, ensure that you have a clear idea of your partner’s, rather than just assuming that they feel the same as you do.
Remember, the key to a successful relationship is communication, and your retirement planning is no exception. Set some time aside to sit down with your significant other and start talking about how you envisage your retirement.
To Your Financial Success!
Jarrad Brown is an Australian-trained and qualified Fee-Based Financial Adviser with Australian Expatriate Group of Global Financial Consultants Pte Ltd providing specialist financial advice and portfolio management services to international and local professionals in Singapore.
Book a complimentary consultation here.