Passing the Baton

David Gartland

ONE OF THE MOST exciting events at a track meet is the relay race. Each runner has to run his or her leg, and then hand over the baton to the next runner. If the baton gets dropped, the team usually loses.

My wife and I occupy two roles in our financial life. I save the money and my wife spends it. This arrangement works well for my wife. When she complains about my frugal nature, I simply explain that this gives her more money to spend. She answers, “Carry on.”

As the saver in the family, I’m also the investor. I’ve set up pretty simple financial arrangements. We each have traditional and Roth IRAs. All other money is in joint accounts, accessible to my wife and me. If I die before my wife, it should be a smooth financial transition.

It’s not always so. My father-in-law was the main breadwinner. He’d bring home the paycheck, and my mother-in-law would pay the bills. At the beginning of their marriage, my mother-in-law failed to make mortgage payments on time. They lost their first house that way. It was a hard lesson. But after that, their finances were in good shape—until my mother-in-law died.

It turns out that my father-in-law didn’t know much about their finances. My mother-in-law had set up all of their bills on autopay, so he never thought about paying the bills.

Before she died, they’d reached the point where they could no longer live in their single-family home in a 55-plus community without help. They sold the house and moved to an assisted living facility. The facility didn’t have autopay, so my mother-in-law began paying those bills monthly. This change wasn’t grasped by my father-in-law. When he gets a bill, or what he thinks is a bill, he pays it without question.

Now, it seems, he’s running out of money. My wife, her brother and her sister will need to find a less expensive apartment for him. It likely won’t have the same services or quality of life that he’s currently enjoying.

Can my wife and I do better? I like to think so. The real wild card in our financial life is the potential cost of nursing home care. While I can’t know what our health costs will be as we grow older, I can make a guess based on family history.

My father died of a heart attack at age 56. No nursing home care. My mother needed hospital care but no nursing home care. She died at 93. My brother was badly injured in an altercation that resulted in two years of nursing home care. He died at 79.

Meanwhile, my wife’s mother had a history of poor health, but remained at home until her final three years. She died at 89. Her father has been hospitalized and needs assistance with his daily care, but at 94 he’s still alive and kicking. Her brother and sister are both alive, and haven’t needed nursing home care.

Reviewing our family history, I chose not to buy long-term-care insurance when I was 60, which I was told was the ideal time to purchase it. When you don’t have insurance coverage for a potential financial loss, you are—by definition—self-insured. You’ll have to pay the cost yourself if the need arises. This is our situation if we have long-term-care needs.

In most other ways, our finances are less uncertain. I’ve tried to simplify our accounts to help my wife after I’m gone. Our traditional and Roth IRAs are with the same mutual fund company. We even invest in the same mutual fund in our Roth IRAs, so she can simply merge the two accounts after my death.

I thought about buying Treasury bonds as part of our financial assets, but decided against it. The requirement to maintain an online account with TreasuryDirect seemed like too much of a complication.

I have regular discussions with my wife, so she’ll be informed and equipped to take over our finances, if necessary. It’s not that she can’t understand our finances. It’s just that she’s not as interested as I am. My concern is she may follow in her father’s footsteps, ignoring the subject until something breaks.

The KISS—or keep-it-simple-stupid—approach is almost always a winning way. I just hope our finances are simple enough for my wife to grab the baton without dropping it.

David Gartland was born and raised on Long Island, New York, and has lived in central New Jersey since 1987. He earned a bachelor’s degree in math from the State University of New York at Cortland and holds various professional insurance designations. Dave’s property and casualty insurance career with different companies lasted 42 years. He’s been married 36 years, and has a son with special needs. Dave has identified three areas of interest that he focuses on to enjoy retirement: exploring, learning and accomplishing. Pursuing any one of these leads to contentment. Check out Dave’s earlier articles.

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