It is well known among financial experts that married couples who pool their retirement savings and coordinate their retirement plans will generally end up with a bigger retirement nest egg when the time comes to enjoy their ‘golden years’. That being said, there are many interesting vehicles for retirement that must be researched and decided on to find the best for you and your spouse. As you might have guessed, we put together a blog article chock full of retirement savings tips for married couples so that you will have a few ideas and some excellent information to use when planning. Enjoy.
If you have a smile on your face whenever you envision spending your retirement years happily with your spouse then you should take time today to sit down and talk about which retirement options will benefit you the best. Below are a number of questions that you should ask yourself and, if you don’t have the answers, find them.
- Within your marriage, what income earning structure do you have?
- What is your adjusted gross income (AGI) as a couple?
- In total, how much can you afford to contribute to your retirement accounts as a couple?
- If you’re employer offers both of you a 401(k) individual retirement account which one gives the best employer find matching?
- Are well rated, high value investing options at reasonable fees offered by your employer?
- Which do you prefer most; multiple investment accounts or as few as possible?
- Are either of you sophisticated investors? One of you? Neither of you? This answer will help determine if you need or prefer a simpler approach to investing.
Once you have answered all of these questions you can now consider your options. For example, once you know which of you has the better employer sponsored retirement plan you can put more of your money into that plan. If you find that neither of you has all that much experience with investing vehicles you’ll realize that you need to do more research. On the IRS website you’ll find a wealth of basic information about IRA contribution and deduction limits as well as details about how to best use your employer sponsored retirement plan.
One of the best suggestions that we have is to contribute enough to your employer funded retirement plan to receive their full match and, if you have additional money left over, consider putting it into an IRA. If simplicity is what you’re looking for you may consider simply sticking with your 401(k) and forgo the IRAs. Also make sure to check if your employer has a Roth IRA option as, even though you pay income tax on it before it goes into your account, your retirement withdrawals should be eligible for tax-free status.
Adding IRA investments to your portfolio can then be looked at. If, for example, the retirement plan you have at work has high fees an IRA can be more appealing as it will give you a wider variety of investment options. Of course be sure to review the income limitations of any IRA as couples that earn a high amount of money may not be eligible for the same amount of tax benefits with an IRA as their 401(k) will give them.
One important task that many couples overlook is to name their beneficiaries. Should an accident occur or medical problem that ends their life early this will become incredibly important. Making sure that this information is accurate and up-to-date is vital.
Finally, the best advice is probably just to do your homework and research. As much as any long-term financial goals, choosing your retirement accounts is a vital part of your retirement planning and more research you do and knowledge you have the better results you will have once those aforementioned golden years arrive.
Thanks for joining us today. We hope that you got some useful information out of this blog entry and fight you to come back and join us again soon for more excellent, informational and topical financial advice. See you then.
