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Throughout my working years, one thing that disturbed me greatly was the lack of concern even disregard shown by many workers for a spouse, especially a surviving spouse and nearly always a woman.
I remember the “good old days” when the husband’s earnings were his money, his pension was his pension. I remember when workers hid their overtime pay from the wife and when they elected a single life annuity pension because only they earned it, when they didn’t want any information about pay and benefits mailed to the home, including W-2s.
I recall when a disgruntled retiree came to our building looking for me claiming he had a gun because I allowed a domestic relations order to give 50% of his pension to his ex-wife. Of course, it was his lawyer that gave away what was rightly the wife’s and to which the retiree agreed-perhaps without reading what he signed.
Hopefully those days are long gone. Times have changed, more women are working with their own assets. Laws were enacted to protect spouses when it came to retirement and benefit plans, the need for which is a sad testimony to the past. Still, single and widowed women struggle the most in retirement.
Our finances are set with the goal should Connie survive me, her lifestyle need not change, including periodic visits to Talbots.
She will receive 50% on a portion of my pension and 75% of another (non-qualified). Life insurance will cover at least three years of living expenses. It is combine group coverage and paid up life.
She receives my FRA Social Security benefit plus interest and dividend income in an equal amount. Then, of course, the accumulated value of our investments to draw upon.
I often read on HD about delaying SS to increase survivor benefits, but I don’t recall other strategies for survivor income. I do remember some people dismissing the need for life insurance.
If delaying SS benefits is a significant part of meeting survivor income needs, perhaps more needs to be done.
What type of financial assets and vehicles do you have in place to provide for a surviving spouse or other dependent? Have you calculated their likely needs as you may have for your own retirement?
This article brings up the question that’s always been in the back of my mind.
We have income that replaces all of our expenses and enough left over to continue funding my wife’s Roth.
I chose when I retired to take the full pension with no survivor benefit. Since I retired from my career at the age of 52 in 2010 my idea was to invest the difference, which we have.
As we’ve gotten older I’ve considered a change in investing approach. I’ve always invested in growth etf’s thinking my wife could just sell whatever she would need for income (if she would need any). But I am now considering keeping a portion in growth etf’s and putting the rest in dividend paying stocks, Reits,etc., and reinvesting the dividends until they may be needed and at that time she could turn off reinvesting the dividends and collecting the income instead.
I would really appreciate and and all HD readers input, suggestions, and ideas
Creating a stream of income for a survivor is paramount to me. But I’m not so sure individual stocks is the way to go. I have created that stream with stock and bond mutual funds, and just two utility stocks with 100 plus year dividend records.
Have you factored in any life insurance? Is you wife inclined to manage investments?
We have always bought term insurance and invested the savings of the cost of whole life. The term ends when I turn 72 (4 years).
She is not inclined but our son and son-in-law are well versed in finance.
I would lean towards dividend paying ETFs and Reits
We do have our two SS incomes of which hers will double if I pass first and three pensions, two of which she will continue to receive if I pass away first
My spouse makes twice what I do and has been maxing out her retirement options (because I insisted on it) for only a few years less than I have, so I’m not worried. I don’t think your question is about us.