Couples risk retirement well-being by failing to talk

Fewer than one in three people (32 per cent) over the age of 40 have ensured their partner will still have an income in retirement if they die first, according to new research from Prudential.
More than one in five couples (22 per cent) have never discussed their financial plans for retirement, while justone in 10 (10 per cent) last talked about their retirement finances more than six years ago.

Worryingly, it's women's retirement finances that are most at risk by this failure to talk. One in 10 women will be completely reliant on their partner’s income in retirement while a further 13 per cent expect their income to come entirely from the State Pension.
Those couples who have discussed their retirement finances estimate that they will live on a joint annual retirement income of around £28,500. However, this figure is at risk of reducing dramatically if the worst were to happen to one of the partners – nearly three in 10 people (29 per cent) have pension savings that will provide an income only to them.
The study also found that three in five couples have no idea how much annual income they expect to receive as a couple when they are both retired, while 18 per cent of people say they do not know how much money their partner has in pension savings.
Kirsty Anderson, a retirement income expert at Prudential, said: “A conversation about what might happen to a couple’s finances if the worst should happen to one partner can be particularly difficult but it could make the difference between the survivor being left with nothing or having a comfortable retirement.
She adds: "Couples who don’t talk about their retirement finances may end up making plans separately and missing out on making the most of the pension-saving tax relief available between them. They may also have unrealistic expectations of what their combined retirement savings are worth. The first step to agreeing regular pension contributions and eventually securing as comfortable a retirement as possible should be to take professional financial advice together."

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