What To Do When Your Spouse Isn’t Ready To Retire (But You Are)


If you’re married and retiring soon, you may face the predicament: what if your spouse isn’t ready to retire- but you are? You’ve already made innumerable decisions together, and this is one more you’ll need to tackle, should that be the case. 

Here we’ll look at why planning for this scenario is essential, how to do so, and what specific strategies can make it a smoother transition. 

Evaluate Your Current Situation

Your spouse may not be ready to retire quite yet for various reasons, but you are. They may have entered the workforce later than you, want to stay long enough to receive certain benefits from their employer, or just may need more time to be ready to be wholly done working.

No matter what the case is, you’ll need to plan, as your spouse could be anywhere from a few years to a decade or more behind you in retirement, and this will create a significant difference in all aspects of life. 

What Will Your Spouse’s Situation Look Like?

First, look at what your spouse plans on doing. If they have a career (for example, in teaching or government) that still doles out a traditional pension, it’s likely worth staying to hit their full benefits. Since a pension is typically based on your years of service, compensation, and age at retirement, this could equal a scenario where they’re still working while you are not.

They may also have to or want to keep working, whether full or part-time. If so, this will be key in your planning as you take a realistic look at your income through them.

 Since you’ll no longer receive a regular paycheck and will most likely draw from accounts you’ve been saving, determine how much of your spouse’s income will cover your lifestyle.

What Will You Be Doing?

Next, look at what you want to get out of retirement. We’ve already established that you want to retire earlier than your spouse. Are you entirely done working, or are you interested in approaching work differently, such as consulting, freelancing, or starting a business?

Each of these will bring with them their logistics to figure out. You would still have an income stream, but it would likely be less. And if you’re starting a business, there can be a lot of upfront costs that you don’t recoup for a while.

If you simply want to retire more for the lifestyle, such as enjoying hobbies, spending more time with your family, or having more free time, you’ll need to plan for budgeting with only your income from savings accounts. This leads us to our next point. 

Strategize Your Draw Down

As you retire early, you’ll finally be pulling money out of accounts such as Social Security, a 401k, a traditional or Roth IRA, etc. These funds must cover your expenses that your spouse’s income won’t. 

You’ll want to first look at your yearly spending through your card history to get some actual figures and understand your costs.  

Regarding Social Security benefits, you can start pulling out money as early as 62, but that won’t give you your full benefits. By standard terms, are you retiring earlier than your spouse but also “early” for yourself? If so, you’ll want to review this chart for how much you’ll receive in benefits based on your birth year. 

If you’ll be pulling money from your 401k, here are a few general things to keep in mind:

  • You could pay a penalty if you withdraw money too early.
  • You could miss a window for tax savings if you withdraw too late.
  • You are required to make minimum withdrawals from traditional IRAs once you reach age 73.
  • You can reduce taxes by sending required minimum distributions to a charity.
  • Your IRA withdrawals could affect your Medicare premiums.
  • Your income from an IRA could result in more of your Social Security being taxed.
  • You may be able to avoid an early withdrawal penalty in certain circumstances.

You’ll want to carefully plan the timing and work with your financial advisor to determine the best method for drawing money from this account.

You’ll most likely have a savings account from which you’ll also be drawing. There are a variety of strategies to employ for a draw-down method from these accounts. Some people withdraw based on percentages or specific dollar amounts, or some group their savings into metaphorical buckets. 

Since what works best for you will differ depending on your financial goals and lifestyle, it would also be prudent to bring this up to an advisor to strategize getting the most out of your savings. 

If you realize that between your savings and your spouse’s income (or lack of), it just won’t be enough to cover everything, you may have to make some sacrifices -such as allocating less towards luxuries or fun- until your spouse can retire. 

This doesn’t have to be the end of the world, but more of a necessity during this phase of your life until you have more money and retirement benefits coming your way when your spouse does retire. 

Don’t Delay 

If retirement is around the corner and you’re ready to enter that phase of your life before your spouse, don’t hesitate! With a good plan, solid communication, and professional help from a financial advisor, you can navigate retiring earlier than your spouse.

We work with couples every day and have helped our clients through a variety of scenarios much like this. Reach out today so we can be of service! 

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