Dear Penny
I’m 53 years old and started saving for retirement late. Fortunately, my wife and I both work, so we save at least 10% of his income for retirement. When I asked my wife how much money she had saved for retirement, she said she had no plans to save at all.
I was taken aback by her answer. I shared some information with her and explained that if she retired now, she wouldn’t be able to pay her mortgage, let alone cover other household expenses to live off of her retirement savings. She was not at all impressed by my explanation. How can she convince her to save for her retirement?
– catch up
Dear Catching
It’s not your responsibility to “convince” your wife of the decisions you want her to make with her money. As partners who share a financial commitment, you need to make a plan for how you want to move forward together, but with your wife’s input, it may be different than what you envision. .
Instead of leading the conversation with evidence and arguments about saving, start by asking why they don’t plan to save. Listen carefully to her answer. Rather than starting an argument, talk to her about why she is the way she is.
In both cases, you should only talk about yourself. This is not an invitation to decide who is “right.” This is an opportunity to reflect on your own relationship with money and gain a deeper understanding of your relationship with each other.
As you talk about why you want to save 10% and why she doesn’t plan on saving anything, think about your history with money, your fears, and your expectations for the future. Let’s. Discuss what each believes to be true about work, spending, saving, debt, and investing. Discuss when you both plan to retire and what you envision yourself doing after retirement.
Considering questions like these may help you understand why you and your wife don’t see eye to eye when it comes to retirement planning. Maybe she doesn’t trust the stock market. Maybe she expects you to keep making money long after you retire. Perhaps she wants to sell her house and downsize to her rental. Perhaps she has a fear of scarcity that makes it difficult to sacrifice part of her salary. Perhaps someone in her family died young and planning for her retirement brings those traumas back to life.
Once you have this foundation of understanding, you can make plans for the future together that respect both of your needs.
Regardless of what you decide, a slow start can make it difficult to stay on track with a typical retirement plan. Talk to your financial planner about your retirement savings strategy, with an emphasis on growing your savings as quickly as possible while reducing investment volatility. If you’re saving more than your 401(k) maximum, ask about Roth IRAs and learn about the latest options for catch-up contributions based on your age.
Track trends affecting your local economy
Subscribe to the free Business by the Bay newsletter
Every Wednesday, we break down the latest news and insights that businesses and consumers need to know.
Everyone is registered!
Want more free weekly newsletters sent to your inbox? let’s start.
consider all options
Have an honest conversation with your wife or a financial planner about the income you can expect to receive in retirement, and plan how you can live comfortably with that income. Also consider other resources you have access to, such as government resources (such as Social Security benefits and Medicare), community programs, and assets (including your home). There are also debt resources available when you’re in financial trouble, such as a mortgage line of credit or a credit card limit increase.
• • •
Dana Miranda is a certified Personal Finance® educator and a contributor to The Penny Hoarder.Send your tough money questions to Ask a question Penny@thepennyhoarder.com.