Ravi and Radha (fictitious name) were married when Ravi was 26 and Radha was 22. During their 38 years of marriage, they decided everything through mutual discussion. The work that both agreed upon was completed. He repaid the loan not only for a house but also for a holiday home 200 km away from his city. Raised two children and settled down. Also created a sizeable pension fund, which can cover the expenses of at least one international trip and half a dozen domestic holidays. They spent the rest of the weekend in the holiday home. Today 67 year old Ravi and 63 year old Radha have a different problem. He did not even plan what would happen after retirement. Radha had a list of work to do after retirement and she started it as soon as she retired. Whereas Ravi had no intention of retiring. Finally, when they started talking about retirement, they realized that both were thinking in different directions. Like these two, for many people, retirement planning is a numbers exercise – how much money do you have, how much do you need, how long will it last, and how to spend it to minimize taxes? Whereas couples should think about how long they can enjoy the money they have. But what actually happens is that couples who have become experts in saving for three decades do not know what to spend the money on. I have seen Ravi’s thinking in most of the couples – trying hard to get an extension of 2 years after the retirement age of 60. Then 3 years part time and consulting till 68. After that, gig employment as much as possible, so that there is no reduction in savings. Earlier people used to retire at a fixed age. After that work stopped. Today things have changed. With relatively longer lives, people are working more flexibly. People are retiring at different ages and are inheriting not only their own property but also their parents’ property. This has changed the social fabric. They don’t work just for money. People like Ravi get structure, status, social connections and purpose from work. But when the work stops, these things do not get transferred automatically. For some people this change seems like freedom and for many others it seems destabilizing. And after retirement, if one partner is struggling with loss of identity while the other is prosperous, this imbalance puts pressure on the relationship. It is recommended that couples answer these questions: When and how do you want to stop working? What would a typical week be like then? Not any holiday or romantic, but how about a normal Wednesday? What would you do? Where will you stay? What would give both of them a sense of purpose or connection? Whose money is it and where will the monthly expenses come from? When income starts coming from pensions, savings and gig work instead of regular salary, the question becomes more important than ever as to who is in control of what and who feels financially secure. What are both of you afraid of? Maybe by running out of money, losing purpose, becoming a burden, or dying before getting to do what you want. What if one of you needs care or passes away first? Does the surviving partner know where everything is? Does he know about all the savings and assets? Not discussing these can have serious consequences. The bottom line is that money is very important, but money is there so that it can give you a better life. And you can’t plan a happy life together without talking about what you both want from retirement.
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N. Raghuraman’s Column: How do you want to spend your retirement life?
