Should you and your spouse retire at the same time? The answer is that it depends on a variety of factors — emotional, physical, and financial. To help you decide on the right time frame for both your retirements, here are a few of the most important factors to consider and how timing may address them.
1. Medical Insurance
One of the biggest concerns for younger retirees is how to fill the health insurance gap between the employer and Medicare. One way to fix this problem is to look at which party has the better health and wellness benefits. If this person can cover both spouses on their insurance until the youngest is eligible for Medicare, you may save a significant amount of money.
2. Account Balances
Of course, no one should enter retirement without honestly assessing their readiness in terms of retirement income. Sit down as a couple with a financial planner and go over both partners' retirement income potential — separately and together. If the family isn't ready as a whole, one partner may work longer and pour money into retirement funds. Ideally, this would be the higher earner.
3. Social Security
Can either of you claim Social Security at this point? This is one common milestone some use as a retirement trigger, and it can help boost the family's income if that person retires.
However, retiring as soon as you claim Social Security can rob the household of significant lifetime income. Working a few years longer could make up for some shortfall in retirement accounts, particularly if the lower-earning partner maximizes their Social Security.
4. Emotional Readiness
Certainly, being ready to retire or not ready to retire is a big part of the conversation. Only you and your partner can decide if one or both are emotionally ready to pull the trigger. It's very possible that one person is while another one isn't. This is okay. Discuss it openly and honestly as a couple. You can fix a number of financial issues, but your mental health is more important.
5. Partner Dynamics
Finally, how will your relationship fare if one person retires before the other? Do you have plans that involve both of you? Will one be resentful? Will one feel guilty?
Your personal relationship is paramount, and this is a big change in it. If family dynamics may become off-kilter, it may be better to wait until both parties are ready to retire together. A partner who wants to stop early might use workarounds like reducing their hours, finding more fulfilling work, or starting a side business.
Where to Start
Want help determining how these factors weigh in your own retirement plans? Need an independent third party for guidance? Start by meeting with a professional retirement planner as a couple. With their expertise and tools, you and your spouse can find the right timing to make your retirement a great one.