Together Is Better: Invest for Retirement With Your Spouse
Together Is Better: Invest for Retirement With Your Spouse

Together Is Better: Invest for Retirement With Your Spouse

Investing for two? Here's how much you need to save for retirement as a couple and how to do it.



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If you’re a newlywed who started saving for retirement before you said “I do,” there’s a lot to talk about with your spouse once the wedding festivities are over.

We know that investing as a couple can be a challenge thanks to factors like differing risk tolerances, the amount of debt each spouse brought into the marriage, and potentially working with vastly different salaries, or even expenses.

And then there’s deciding on your magic numbers—aka asking yourself how much money the two of you really need to live on when you’re older.

Preparing for your future retirement expenses requires looking at the big picture of what you and your partner's lifestyle is like now and then projecting those costs more than 30 years into the future. Needless to say, it’s not a perfect science. Life events happen along the way that could either reduce your expected cost of living or shoot it way up—but at least it’s a starting point.

Over time, you and your spouse should expect to talk about money a lot. Expect to plan, then plan again, and plan again, knowing that every conversation will refine your decisions and continually prepare you for life after your working years. 

Ahead, let’s look at the different factors you should think about when planning how much you and your beloved need in order to have truly golden golden years.

The three phases of your retirement spending

Your retirement costs aren’t always going to be the same from ages 60 to 90. We often talk about our retirement years as though our lifestyle will stay fixed, but retirement itself comprises 30 years, sometimes even more. Think about all that’s happened in your first 30 years of life—now imagine similar lifestyle and economic fluctuations when you and your partner are seniors.

Financial planners therefore will often frame expenses during retirement years as a bell curve with three unique phases: the 'go-go' phase, the 'slow-go' phase, and the 'no-go' phase. This is how Mac Gardner, Florida-based certified financial planner and founder of financial literacy company FinLit Tech, puts investing for retirement into context.

In the first phase of retirement, a couple’s spending increases from their baseline as they celebrate their newfound freedom. “Theoretically in that first phase of retirement—that ‘go-go’ phase—expenses are going up,” says Gardner. Maybe you and your spouse will buy a new car for long roadtrips, take that extended European vacation, pop in on your children to spoil the grandkids, or buy a lake house or retirement home in your dream location. 

But this won’t last forever. In the second phase, the peak of the bell curve, a couple’s expenses usually level off. They start traveling less as they age, perhaps settling down in their fancy new recliners, and requesting that their families start visiting them around the holidays—not the other way around. This is the “slow-go” phase.

And finally, in the last phase—sometimes called the “no-go” phase—a couple’s expenses reduce dramatically. Ideally in this phase, your home and autos are paid off and your expenses are just the basics. 

However, a big concern in the last phase is healthcare. According to a recent Fidelity estimate, today’s average couple retiring at age 65 in 2021 needs about $300,000 to cover healthcare costs for the rest of their life. That number will likely be bigger when millennials are senior citizens.

So even though your other expenses may slow in the “no-go” phase, you and your spouse should prepare to have enough set aside that you can comfortably pay for healthcare.

How to estimate retirement costs

So how do these three phases of retirement factor into a couple’s estimates? 

One way to plan for your lifestyle costs is to take a percentage of your ideal lifestyle today. So a couple living happily today on a $100,000-per-year lifestyle might aim to live on about 70% of that lifestyle in retirement. This is a rough average of both the accelerated expenses in phase one, and the phases in which your spending drops.

That’s a $70,000-per-year lifestyle. Multiply that by about 30 years, and you get $2.1 million.

Retirement saving strategies for couples

We know setting a $2.1 million goal for your retirement savings can feel like a lot. So let’s dial it back and look at some retirement saving strategies for couples.

To start, look at the income and expenses of both partners. Just because you’re married doesn’t mean you both have the same costs (now or in the future). For instance one partner might have higher medical bills and the other may be paying off student loans. And as for income, one partner may be working at a tech startup with a six-figure salary, while the other teaches elementary school and makes $42,000 per year.

If possible, both couples should take advantage of any company matching through their prospective employers. But if one spouse isn’t working at all, there is such a thing as a spousal IRA. 

A spousal IRA is just a regular IRA (either traditional or Roth), that you open in the name of a non-working spouse. The working partner can contribute up to the annual maximum to their spouse’s IRA, just like a normal one. In 2021, the maximum is $6,000 or $7,000 for those over age 50.

A spousal IRA isn’t co-owned by both parties. Therefore, spousal IRAs protect the non-working spouse in the event of a divorce. The money is legally earmarked for them. 

You and your partner can open an account of your choice at any leading IRA broker or robo-advisor such as Betterment, Personal Capital, or Schwab. You’ll just need to provide some personal information, such as birthdate(s) and Social Security number. We recommend setting up a monthly auto-deposit to take advantage of dollar cost averaging and compound interest over time.



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For instance, a monthly contribution of $300 can yield around $51,925 with an average return of 7% (play around with a compound interest calculator to decide your ideal plan).

Paying off debt as a couple

While that doesn't sound like a retirement savings strategy, student loans can pose a significant barrier to getting ahead in your investments. If one partner (or both) has a lot of student loans left over from undergrad or grad school, refinancing them can be a helpful way to knock them out quickly so you can focus on growing your shared wealth.

Student loan refinancing can be a great method for dual-income households that are finally making the big bucks after paying an arm and a leg for school. Depending on the kind of loans you have, you can either consolidate student debt with your spouse and/or add your spouse as a co-signer for your loans. With combined income and a good credit score, DINK couples (“dual income, no kids”) can often get low interest rates on three- or five-year loans that help them escape the drudgery of a 10-year, high-interest repayment plan.

The robo-investment platform SoFi started with student loan refinancing. And now members can start investing trade stocks, fractional shares, and ETFs with just $5. In addition, free financial planning comes along with opening your SoFi investing account.



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Alternative investments for couples

If you and your spouse are into alternative investments, there are ways both parties can benefit and diversify at the same time.

Diversification can be a fun way to compromise with your partner. When you have a handle on passive retirement investing through robo-advisors, adding non-traditional investments to your portfolio can be a fun win-win that introduces a little bit of calculated risk into the equation. That way, nobody feels left out (both the risk-averse and all-in spouses feel seen)—and you address long-term security while opening up to the possibility of shorter-term gains.

First, set aside some "fun money" that isn't crucial to your financial goals. Some couples spend $200 per month on a fancy dinner, but maybe the two of you spend $200 investing in crypto through a platform like Gemini. Try this together for a year to see how it adds to both your portfolio and your relationship. And for a more stable strategy, you could set aside another part of your “fun money” to invest in farmland.




We’re not saying you should get competitive with it—we swear—but if you are the type that likes to keep score at the Cross Fit gym or challenge each other to budget better on groceries, you can use your “fun money” investments as a playful way to spread out financial risk and keep up with current market trends.