Financial planning can be a challenge, especially for married couples in the modern world. Many people don’t mind taking a backseat when it comes to financial planning, especially if they can fall back on a husband’s or wife’s good judgment. However, financial planning—as stressful as it may sometimes be—should never be an individual affair.
Why Both Spouses Should Be Involved in Financial Planning
People have a lot of different reasons for entrusting their significant other with financial planning. Often, but certainly not always, it is the wife who leaves decisions up to her husband. One spouse might defer because the other spouse is better at math, earns more money, or has a good instinct for investing. No matter the reason, though, people shouldn’t count on their spouse having all the right answers all the time.
Consider a worst-case scenario: if you lose your husband or wife to an unexpected illness or sudden accident, what would you do? You’d likely be stricken by anxiety, struggling to make sense of the unforeseen. However, you’d also have to take control of accounts that might be in your partner’s name. You may have joint investments or a docket of financial documents you scarcely understand. All of a sudden, you’re going to have to do a lot of learning, all at a time when you may not be able to think straight.
Understand Your Finances
You might not be as good with numbers as your partner, but you know your life and your aspirations better than anyone else.
In all likelihood, you and your significant other both work. You might have different incomes, but you can still collaborate on creating a plan for your long-term future. However, you can’t collaborate if you don’t have a holistic picture of your savings, investments, and liabilities. You need to agree on:
- Your budget
- Your retirement goals
- Your post-retirement aspirations
- Your financial future
One spouse shouldn’t make all the decisions or sign off on every commitment. Even if they’re better at planning, any sort of mutual commitment demands mutual discussion. And, as they say, two heads are always better than one: almost every financial planner or wealth manager worth their salt will ask that both spouses attend the initial consultation. Because if both spouses aren’t on the same page, misunderstandings can and often do happen. If one partner is in the dark about how their money is being used or invested, they might lose opportunities to save big on taxes or contribute to an investment retirement account.
Educate Yourself and Your Partner
If you’ve taken a passive role in financial planning, catching up can be a real ordeal—even if your partner is completely cooperative. You can start by asking your husband or wife to walk you through the decisions they’ve already made. Consider asking:
- How they calculated the monthly budget
- How much money they’re putting toward retirement, and why
- How you’re planning to retire: will you live off Social Security, or do you have investments to supplement it?
- What strategies, if any, have they taken to protect your estate?
- What will happen to individually owned assets, properties, or accounts if one of you passes away?
- Where are your important financial documents, like titles or investment records, and how can you access them if your partner is unable to?
Get Help When You Need it
Financial planning goes beyond setting a budget and making a few token investments. Your ideal financial plan should be comprehensive, accounting for your short-term needs, long-term aspirations, and present financial circumstances.
Professional financial planners and wealth managers have experience helping people of all different backgrounds achieve their dreams, whether they’ve already devised a clever investment strategy or have yet to put a penny in their savings account.
Contact Us Today
Quraishi Law is an Arkansas-based, community-oriented firm. If you and your spouse need help creating a joint financial plan or simply getting started on the way to a better future, send us a message online today to schedule your initial consultation.