Creating a 'Shared Retirement Confidence'

Six steps every same-sex couple should consider taking

Article Provided by Kevin J. Smith, CFP®, Wells Fargo Advisors 


If you’re worried about having enough money to someday retire with your loved one to a comfortable lifestyle, you’re not alone. According to a recent study, retirement is the number-one financial concern for lesbian, gay, bisexual, and transgender (LGBT) Americans.* That concern may only grow as laws pertaining to same-sex marriages continue to evolve and couples plan for a shared retirement.

The good news is that there are steps same-sex couples can take right now to create a unified understanding — and a shared confidence — of how and when you’ll both be able to retire.

Step 1: Review your current financial statuses and goals

The first step is to start the conversation about where you are today. Together, review how much you have in checking and savings accounts, certificates of deposit (CDs), retirement accounts, stocks and bonds, and other investment accounts. Then discuss your current financial goals. For instance, do you foresee buying a new home in the future? Are there upcoming educational funding needs? Do you want to be debt-free by a certain date? Coming to an agreement on your right-now goals is necessary before you can begin to plan for retirement.

Step 2: Discuss your lifestyle expectations for retirement

Take the time now to discuss your expectations and hopes for retirement. Together, answer questions such as: Is downsizing after retirement a good idea? Is travel a priority? Where do you want to live? Is continuing to give to charity important? Once you’ve established your joint vision, it’s easier to work together to ensure your financial retirement strategy is on track. 

Step 3: Do the preliminary math

The next step is to figure out, given your collective vision, what types of monthly expenses you’ll have after retirement and how much monthly income you’ll eventually need to afford the retirement lifestyle you’ve agreed on. With this information, you’ll gain a better understanding of what your retirement financial goals should be. Plus, you’ll have a better idea of when it might make sense for each of you to retire, given how much you need to save.

Step 4: Make beneficiary naming a priority

Part of developing a shared confidence in the long-term future is knowing you’ll each have surviving-partner access to your combined assets. That’s why it’s essential for all same-sex couples to have written wills and to clearly name their partners as a beneficiary on banking, investment, and retirement accounts. You’ll also want to check to see whether or not your surviving partner will be able to roll any inherited retirement benefits directly into their own retirement account. This will depend on your marital status and specific employer rules.

Step 5: Know the current rules on Social Security benefits

The U.S. Supreme Court’s 2013 Windsor decision and the the 2015 Obergefell decision reinforces how important it is to develop a strategy for claiming your Social Security benefits as a couple.  According to the Social Security website, “more same-sex couples will be recognized as married for purposes of determining entitlement to Social Security benefits…”  The site also encourages anyone to apply if you believe you are eligible for benefits.  You may want to periodically revisit the ssa.gov site for updates. 

Step 6: Schedule a meeting with a Financial Advisor who understands your unique needs

Retirement planning is complicated, perhaps even more so for same-sex couples today. So even if you think you have a handle on your joint plans, it’s a good idea to meet with a Financial Advisor who is aware of the nuances of retirement planning for same-sex couples and who can help you navigate your way, together, with certainty.

An excellent resource is our company’s team of Financial Advisors. They were the first in the industry to be trained and certified through the Accredited Domestic Partnership AdvisorSM (ADPA) program. Visit wellsfargoadvisors.com/adpa for more information.

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Wells Fargo Advisors does not offer legal or tax advice.

*The LGBT Financial Experience, 2012-2013 Prudential Research Study 

This article was written by/for Wells Fargo Advisors and provided courtesy of Kevin J. Smith Financial Advisor, First Vice President – Investment Officer in Green Bay, WI  at 920-468-9227.

Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE

Wells Fargo Advisors, LLC, Member SIPC, is a registered broker-dealer and a separate non-bank affiliate of Wells Fargo & Company. 

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