You learn, you implement, you make mistakes, you seek advice. So whether you are already retired, nearing retiring or thinking about it as an abstract concept many years away, we can help you engage in this ongoing process.
In addition to general retirement income planning for a couple, it’s a good idea for married couples to also engage in individual reitrement income planning. Odds are, one spouse will live longer than the other, so it’s important to plan for financial security once one spouse has passed away. Given that women generally live longer than men, this can be especially important for them.
Needs change throughout life, whether you’re a man or a woman. But a change in marital status can have a more detrimental impact on financial security in retirement for women.
When a woman gets divorced, she is likely to lose her survivor’s benefits from her ex-husband’s pension plan. That’s why it’s important as part of the divorce settlement to draw up a special court order, called a Qualified Domestic Relations Order, that can specifically provide for a survivor’s pension in the event of divorce.
Widows now have protection for survivor’s benefits, thanks to a 1984 law that requires private pension plans to provide a pension to a worker’s surviving wife (or husband) if the employee earned a benefit.
In fact, the employee’s spouse has to provide written permission in order to waive this right. Note, however, that this legislation only applies to private pension plans. If the spouse worked at a state, local or federal government job, then the widow should find out what rules apply to that pension.
Now, some people suffer through one or more divorces and decide, “That’s it. I’m not ever getting married again.” They may engage in a long-term relationship and even share a home with a partner, but simply not marry. This arrangement should be considered in the process of retirement income planning, because common law and non-married partners may not have a legal right to survivor benefits from Social Security or pension plans. Despite its troubles, marriage may still have financial benefits, depending on the situation.
If you’re a working woman, you have plenty of good income planning options. Especially when you consider that within the next 15 years, it’s estimated that women will control two-thirds of the wealth in the U.S.
That is particularly remarkable when you consider that, on average, women still earn about 22 cents less per dollar than men. But women will need the extra funds, because right now experts project that 70 percent of baby boomer wives will outlive their husbands by 15 to 20 years.
Regardless of where you are in the lifelong process of retirement income planning, it’s certainly never too late to get started. Even if you have a plan for retirement income as a couple, it’s a good idea to ensure it would cover a surviving spouse.
As always, we’re here to help you with just that type of retirement income planning — now, and as you need it throughout your lifetime.
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