This month I had the pleasure of being asked to participate in my first ever Twitter Q&A with Reuters, hosted by Lauren Young. It was a lot of fun and a privilege to join a panel made up of some of the top financial minds that I admire the most, including Jean Chatzsky, Mandi Woodruff, and Farnoosh Torabi, among others. It was an incredible experience and there were a lot of great questions from participants as we tackled where couples go wrong when it comes to money and how can they make it right. Here are three topics every couple should be discussing!
How should couples tackle retirement planning?
Focus on building a nest egg especially at the beginning of your marriage #reuterslove
— Farnoosh Torabi (@FARNOOSH) June 2, 2015
Farnoosh is absolutely right! Invest for the long term, and avoid being too conservative as life expectancy is increasing. It’s important to contribute whatever you can to your 401(k) and to strive to increase that percentage over time. Even if you can only save a tiny amount now, it’s critical to start saving early to fund a fulfilling retirement and to maximize company matching and contribution limits. Equally as important, be mindful of what you’re paying in fees, as they compound over time and could eat up to a third of the returns of retirement assets.
Women are more reluctant to talk about money than men. Why? And what are the implications?
I fully believe each partner should keep their own retirement savings acct. It’s empowering knowing I have my own nest egg #ReutersLove
— Mandi Woodruff (@mandiwoodruff) June 2, 2015
I couldn’t agree more with Mandi! One of women’s biggest fears when it comes to financial matters is a lack of confidence and feeling that they are not smart enough, which of course isn’t true. They don’t feel like they know what they are doing or how to do it and because of that, they do not feel like they can make good decisions. Seeking out a professional financial planner or an investment advisor, finding someone that you can trust to help you reach your financial goals, builds confidence and empowers women to get up there in the financial “front seat” with their husbands.
What financial guidance do you have for newlyweds?
A3: The couple that saves together, stays together. Debt often = divorce. #ReutersLove
— Jean Chatzky (@JeanChatzky) June 2, 2015
To Jean’s point, aren’t marriages a bit of a compromise? It’s the same in working together as a couple on finances. Openly discussing money matters and understanding each other’s priorities and financial goals is critical. Honestly talk about your current financial situation and determine together your short-term and long-term goals. It’s important for couples to understand what their options are and what investment instruments are available to them. Evaluate the pros and cons of ETFs vs. mutual funds, active vs. passive investing, and make sure that you’re on the same page when it comes to your thoughts on risk vs. reward.
I want to give special thanks to the Reuters team for inviting me to participate in their Love & Money Twitter Q&A! It was truly exciting and so informational for everyone involved. At the end of the day, panelists and participants agreed that couples should share with each other their hopes and dreams and work together to determine the funds needed to make that happen.