Marital Problems Can Cheat You Out Of A Comfortable Retirement

It seems that for many Americans, money problems and marital strife go hand in hand. But what comes first? The money problems or the marital discord? Do money problems cause marital problems, or do marital problems lead to financial ones? The answer is probably somewhere in the middle. But whatever the situation, marital problems can be a real threat to your finances, both in the present and in retirement.

Retirement should be a time of relaxation, fulfillment, and finally enjoying the fruits of one’s labor. However, for many older Americans, it becomes a period marred by financial stress and emotional turmoil. The truth is, the marital and financial problems didn’t just appear out of the blue one day. They were likely seeded years ago through ongoing marital discord and poor lifestyle choices.

The Impact of Marital Discord on Retirement Finances

Barbara and Joe, a fictional couple emblematic of many retirees, find themselves in a situation where their marriage has soured, casting a shadow over their retirement years. Research highlighted in the New York Times suggests that an unhappy marriage is one of the strongest predictors of an unsatisfactory retirement. Emotional dissatisfaction can spill over into financial decisions, affecting savings strategies and retirement plans. The strain of an unhappy marriage can lead to higher instances of divorce, which is not only emotionally taxing but also financially draining. In fact, divorces among older adults, sometimes referred to as "gray divorces," are becoming more common, adding a layer of complexity to financial stability in retirement.

Financially, divorce later in life can result in the division of assets accumulated over decades, potentially impacting retirement savings and income sources such as pensions and Social Security. The cost of divorce itself, estimated between $15,000 and $20,000 on average, according to Forbes, further erodes savings that were intended to sustain retirees through their later years.

Lifestyle Choices and Financial Health in Retirement

Beyond marital discord, lifestyle choices before retirement play a pivotal role in determining financial health during retirement. The pressure to "keep up with the Joneses," amplified by social media and consumer culture, often leads individuals to overspend and accumulate debt.

This phenomenon not only jeopardizes current financial stability but also jeopardizes long-term retirement planning. Purchasing luxury items and indulging in expensive habits can quickly deplete savings that are meant to last for decades. This leaves many Americans approaching retirement with insufficient savings, leaving them vulnerable to financial hardships as they age.

Don’t Let Marital Problems Torpedo Your Finances and Retirement

To avoid the financial pitfalls associated with marital discord that can spill over into retirement, individuals and couples can take proactive steps:

• Invest in Relationship Health: Prioritize open communication and mutual support within the marriage. A couple unable to communicate and be in sync on a personal level has no chance of being in sync when it comes to their finances.

• Invest Planning: Think about investment planning, not financial planning. The term financial planning often entails clinging to traditional financial strategies that have proven to be inadequate. This can be witnessed by the millions of Baby Boomers facing retirement unprepared. Plan to invest like the ultra-wealthy do—by allocating to private investments in companies (i.e., private equity) and in cash-flowing real estate. Once again, being on the same page in terms of the direction of your investing will require being on the same page in terms of your relationship.

• Think Long-Term: Explore opportunities for long-term investments that generate passive income, such as real estate or private equity. These assets can provide stability and growth potential during your work life and well into retirement.

• Lifestyle Choices: Investing to build wealth will require mutual discipline. And it will often involve saving to invest. This will mean spending less on the things you don’t need in order to invest in assets that will pay you back. Practice mindful spending and avoid unnecessary consumerism. Differentiating between needs and wants can prevent overspending and the accumulation of debt, which could derail investment planning. This includes recognizing the influence of social media and peer pressure on spending habits to prevent spending due to FOMO (the fear of missing out).
• Health and Wellness: Prioritize physical and emotional well-being. Healthy lifestyles not only reduce medical expenses and stress but also contribute to overall satisfaction during retirement.

In conclusion, achieving a comfortable and fulfilling retirement requires careful consideration of both personal relationships and investment planning. Marital discord and lifestyle choices can significantly impact financial stability both during your work life and during retirement, underscoring the importance of proactive measures to safeguard one’s future.

By fostering healthy relationships, making prudent financial decisions, and embracing a balanced lifestyle, individuals can navigate the complexities of retirement with confidence and resilience.