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The Retirement Talk Couples Need To Have -- Now!

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SPECIAL FROM Next Avenue

By Amy Zipkin

Husbands and wives often disagree about when and where they’ll retire. Here’s how to get on the same page.

Although couples in their 50s and 60s frequently talk about their children, upcoming vacations and potential home improvements, they often ignore a vital subject: their future retirement. But financial advisers say that failing to discuss with your spouse when and where you’ll both retire can lead to serious problems, financial as well as marital.

The Couples Retirement Study released by Fidelity Investments in June 2011 showed some striking disagreements:

  • 62 percent of couples approaching retirement didn’t agree on their expected retirement ages.
  • 47 percent of couples approaching retirement didn’t agree on whether they’ll continue working in retirement.
  • 33 percent of couples didn’t agree or didn’t know where they plan to live when they retire.

In addition, 73 percent of the couples disagreed on whether they had a detailed retirement income plan. "While many pre-retirees are aware of the need for a retirement income plan and to prepare for various expenses in retirement, we’re not seeing an increasing number of couples acting on their increased level of awareness," says Chris McDermott, a senior vice president at Fidelity Investments.

(MORE: Money Rules of Thumb You Need to Follow and Ignore)

Having ‘The Talk’ Is Essential

What’s keeping couples from having “The Retirement Talk”?

"Couples don’t necessarily see eye to eye about retirement and they don’t want to deal with it," says Dorian Mintzer, co-author with Roberta K. Taylor of "The Couple’s Retirement Puzzle: 10 Must-Have Conversations for Transitioning to the Second Half of Life." "The more couples think and plan together, the more their decisions will be conscious and intentional."

And, Mintzer adds, the more that couples air their differences, the greater likelihood they’ll be able to accommodate their wishes.

One Couple’s Differences Over When and Where to Retire

Bruce and Esther Bay, who live in central Michigan, are struggling a bit to devise a retirement plan that will work for both of them.

Bruce, a 63-year-old health analyst at Michigan Blue Cross Blue Shield, anticipates retiring this year to do some type of volunteer work. Esther, 60, is a clinical associate professor at the University of Michigan School of Nursing and expects to continue working full-time until, she says, "it impacts our quality of life." She’s not certain when that would be.

(MORE: Relationship Rescue: Resolving Money Issues)

Where the Bays will retire remains up in the air, too.

The couple owns a small cottage farther north in the state, but 20 years ago they also bought two and a half acres on a lakefront near Traverse City, in Michigan’s Upper Peninsula, expecting to build a custom home there for retirement. They’ve since had a change of heart.

"There was conflict," Esther says. Bruce has become less interested in pursuing hobbies, like hunting and fishing, that drove them to purchase the property. Esther has decided she’d rather spend time attending theater and concerts and traveling. They hope to sell the land when the real estate market improves.

How Do You Each Define Retirement?

David A. Frisch, president of the Frisch Financial Group in Melville, N.Y., tells couples it’s important to "know what you mean when you say retirement." In other words, figure out together not only when each of you will retire and where you’ll live together in retirement, but whether either or both of you will find other work and how much you’ll need to live on. He instructs clients to identify their retirement expenses and prioritize them.

Mintzer suggests couples develop their retirement expectations and dreams separately. That way, they’ll have specifics to discuss with each other.

(MORE: The Biggest Retirement Mistake Boomers Make)

Along these lines, one financial planning firm, Ameriprise Financial, gives its clients a brochure called "Dream Book: Planning Beyond the Numbers," with sections to fill out about such things as where you’ll want to live and how you’ll stay active. Each spouse completes the guide on his or her own, then the couple meets with an Ameriprise adviser to work through conflicts.

What to Do if You Disagree

If you and your spouse don’t see eye to eye about your retirement plans, recognize that disagreement is normal, Mintzer says. She suggests the two of you list areas of agreement and areas where you both feel you can compromise.

A financial planner, or even a marriage therapist, could help if your conversations start becoming acrimonious, Frisch says.

You might also want to get advice and insights from friends and family members who have retired or are making plans. "It’s an ideal conversation over dinner," Mintzer says.

Choosing a retirement location can be especially thorny. If this topic is contentious, you might want to attend one of the North Carolina Center for Creative Retirement’s weekend workshops on where and how to relocate in retirement. The next workshop will be May 24–26 in Asheville, N.C.

Once the two of you have worked out a timetable and location for retirement, update and re-evaluate the plan "at least annually," Frisch says. Changes in your employment, health or finances could require some necessary readjustments.

Read more on Next Avenue

The Biggest Retirement Mistake Boomers Make
Financial Planning Essentials for Same-Sex Couples
The Perils of Aging Alone

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