Many families nowadays are comprised of two full time earners who share in the financial responsibilities. Incomes may not always be equal of course, and many families still live according the more traditional model of one income provider and one home maker. Regardless of how the money is earned, the future financial liabilities of the family are the same, and the planning process should thus reflect this fact.
In practice, I have found that the earner is often the one who takes on the additional burden of formulating the financial plan on their own, and this is not the correct approach in my opinion. Attitudes toward risk vary greatly, and if the discussion on taking risks is had as a family unit then there is a greater likelihood the end result will accurately match the composite attitude of both parties as opposed to only one. A nightmare scenario you want to avoid is having lost a huge chunk of the nest egg when your better half is extremely risk averse and clueless of what you have been up to in the investment account.
The fact also is that both halves of any marriage make contributions, even if only one is measured in monetary terms. Most couples share in all of the major decisions of their lives together, and finances should be no different. Planning together and taking a route both of you are comfortable with will save numerous potential arguments in the future if market roller coaster rides inevitably send the retirement account up and down over time. It will also help both parties understand why some non-essential purchases might be better off delayed or skipped altogether.
One of the main reasons financial plans are often crafted alone is due to the way financial advisors work. They often visit clients during business hours and meet them at their place of employment. This seems practical enough, and in the early stages of information gathering it is probably ok to relay the info back to your spouse. When it comes time to finalise things it is better to make an appointment at the home or have a dinner somewhere. Most financial advisors hope to avoid this as they worried a second person with a whole new set of objections could stand in the way between them and getting the business they are after. This is their problem though, not yours. Remember that they work for you, or they should be anyways.
The risk taking aspects of financial planning are in my opinion the most important part to do together. If there is a disagreement, my advice is always to err on the side of the more conservative partners. An “I told you so” event is much less detrimental to your relationship in an instance of missed opportunity than it is for one of an oversized loss. Regardless of what happens in the future, if you have discussed all of the potentialities together then however the plan goes it should not have a negative effect on the relationship. If it goes great, it will be one more solid block in the foundation of your lives together.
David Mayes MBA provides wealth management services to expatriates throughout Southeast Asia, focusing on UK Pension Transfers. He can be reached at firstname.lastname@example.org. Faramond UK is regulated by the FCA and provides advice on pensions and taxation.