I believe financial readiness takes on many forms. One of those forms we help our clients prepare for is being financially independent. Said differently, the stage in life where your money works for you versus you working for it—especially in retirement.  In my experience, households that are successful in their financial independence are the ones where both partners are involved.  There is a larger percentage of married couples than single-adult households. I find that in most marriages (or life partnerships) we divide different household responsibilities and duties. We each take ownership of something we enjoy or are best suited to handle. This may be based on educational training, enjoyment of the task, or by default, but someone has to do it!

In my household, for example, most health-related issues or questions go through my wife, as she is a Registered Nurse. When it comes to finances, however, she defaults to me as a professional wealth manager. She can handle our finances, but she does not have the desire to handle them. As a financial advisor, it is natural for me to take on the responsibility of our finances. She has always said, “You handle it. If I cannot trust you, then who can I trust?” But therein lies the problem. I do not make any major financial decisions without running them by her. I believe women have unbelievable intuition and it is important that she stays informed.

Life sometimes has a way of throwing us some harsh curveballs. I have experienced a lot in my 35+ years in this business. I have seen situations where a spouse has relied entirely on their life partner for all household financial decisions. Why? Because of their ability, faith, and trust in their partner. I remind my wife if something happened to me, she would be forced to make all financial decisionswithout a sounding board, in the most emotional state in her life. In my experience, it is a much easier and more successful transition when both partners stay engaged in the household finances. I am not necessarily talking about duplicated efforts, or all decisions being made jointly, but I am talking about being aware, knowing what is going on, and understanding why decisions are being made.

The best solution is to engage in a relationship with a Financial Advisor who knows your dreams, goals, and fears. One that knows your limitations and your strengths. One that has the ability and desire to help when life gets rough. And we all know life can be difficult some days.  People underestimate the value of a long-standing relationship with a trusted advisor until life exposes its difficulties. Just because you understand and enjoy investing does not mean that your spouse does. Do not let divorce, death, mental or physical impairments of your spouse ruin what the two of you have worked so hard to create.

Action Items

  • Both spouses should attend as many reviews with their Financial Advisor as possible
  • Make certain you have a good working relationship with a trusted advisor. One willing to understand both of your viewpoints, strengths, and weaknesses
  • Take inventory of your financial assets
    •  We can help with this. Go to sbcwealth.com. Under the “Our Process” tab go to “Financial Tools” for our Personal Financial Organizer
  • Keep your estate plan current—know what it says and why it is structured the way it is
  • Know your advisory team—Financial Advisor, CPA, Attorney, Insurance Agent, etc.
  • Have a high-level understanding of your household financial picture

Financial readiness should not be left to chance, nor should you wait until it is too late to address the need. Stay involved in the event you are put in a position to make all financial decisions on your own. This should provide confidence and peace of mind now and in the future.