Getting married is a major life event. It marks a transition into a new way of living, and it alters how you need to plan for the future. Even if your retirement planning was on target before you married, that doesn’t mean it will meet your needs now that you are part of a married couple. Certain decisions are inherently more complex once you are no longer single, particularly if you both have different perspectives. But does that mean you need to start retirement planning right after the wedding? If you are wondering whether that’s the case, here’s what you need to know.
When to Start Retirement Planning After Getting Married
Ideally, you want to sit down with your new spouse and talk about retirement as soon as possible. While this doesn’t mean you have to bring up the topic on your honeymoon, it should be a priority within the first month or two of marriage.
The reason you want to act quickly is your financial lives are now merged. You need to build a nest egg that’s appropriate for your joint needs and cumulative goals. Additionally, you have to make sure that you’re on the same page about how you both will become financially independent one day. This ensures that you can work together toward a mutually beneficial and enjoyable future.
The Critical First Step for Your Retirement Accounts
Before you worry about adjusting your retirement strategy, you need to take care of one critical step. If you haven’t updated your beneficiary information, do that immediately. Otherwise, if your spouse isn’t listed on your IRA, 401(k), or other accounts, they might end up with those assets if something happens to you. Instead, they will go to the beneficiary you listed when you were single.
Planning for Retirement as a Newlywed Couple
Once you’re married, you need to look at your retirement strategy and potentially make adjustments. However, your first step isn’t to propose changes. Instead, it’s to see where you stand.
Both you and your spouse should pull records for any retirement-oriented accounts. This can include employer-sponsored plans, IRAs, or anything else that is specifically being set aside for your golden years. That way, you can see how much you have saved as a couple and determine how you need to proceed to reach your goals.
After getting a clear picture, you can move on to the retirement planning phase. You can both discuss your goals or expectations, including whether you’d like to retire early, have enough money to travel, purchase a home in a particular area, or anything else that makes up either of your retirement dreams.
From there, you can make adjustments to how much you are setting aside. You might want to use a retirement calculator to determine whether you are on target to reach your goals or what sort of changes are needed to make sure you achieve them. That will give you some basic numbers to work with, which can be helpful.
You can also decide if you want to open joint investment accounts or leave your individual accounts intact. Technically, you don’t have to pool your assets, and there are situations where keeping things separate is a good idea. For example, if you both have different risk tolerances, having personal accounts allow you both to remain comfortable.
Don’t Forget About Social Security or Taxes
When you start planning for retirement as newlyweds, you don’t want to overlook the potential value of your Social Security benefits. By heading online and going to the mySocialSecurity, you can access your Social Security statements and see an estimate of what you’ll receive. That way, you can factor those amounts into your plan, if that’s what you’d like to do.
However, if you want to leave those benefits out of the equation, that’s also fine. In the end, it may mean that you have more than you need saved for retirement, and that isn’t necessarily a bad thing.
Another point you need to factor in is how getting married alters your taxes. This is an important aspect of retirement planning as how you proceed impacts your immediate and future tax situation. You’ll need to determine which kinds of retirement plans are best for your tax situation, as well as whether filing jointly or separately provides you with the best outcome.
Ultimately, planning for retirement right after the wedding is a pretty good idea. It allows you to adjust your approach quickly, ensuring you can achieve your joint goals and work toward the retirement that you both have in mind. Plus, it gives you a chance to maximize your financial situation, accounting for changes to your tax status and the impact of Social Security. In the end, it’s never too early to start planning as a married couple, so start sooner rather than later.
Do you think planning for retirement immediately after the wedding is a smart move? Why or why not? Share your thoughts in the comments below.
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