Ready For Retirement
Ready For Retirement
Does Your Spouse Really Know the Financial Plan? Why That Matters │ Root Talks
Money conversations fall short when only one spouse is at the table. It’s easy to treat financial planning like another household task to divide and conquer, but unlike errands, your financial plan is the blueprint for your shared future.
What we’ve seen time and again is that the person sleeping next to you often holds the key to your blind spots. They know what stresses you out, what brings you joy, and what dreams you’ve stopped saying out loud. That’s why the best financial plans aren’t just about returns or tax strategies—they’re built around conversations that reflect what both of you actually care about.
One question we love to ask: “Would you rather spend more each year, or donate that money to your least favorite political cause?” It’s uncomfortable and it works. Couples suddenly uncover real goals they’ve never voiced before.
When both partners are involved, tradeoffs become clearer, values rise to the surface, and decisions feel more connected. It’s not just better planning, it’s a better relationship with your future.
What conversations might you and your partner still need to have?
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James, as you know, we require spouses part of our planning process. Spouses partners Now require sounds like an intimidating word and many of you who reach out to Root you first reach out to Root and you're the one spearheading it. You've been managing the finances. You maybe enjoy hearing how we help clients optimize and you might want that for yourself. But maybe your spouse or partner just generally finds finances less interesting.
Speaker 1:We actually don't think that's the case. We think they just haven't been asked the right questions yet, and your spouse plays a really important role in your planning process. They're the ones sleeping right next to you. They have the best seat in the house. We want to understand are you really stressed out? You told us during our meeting that you're not worried about being bored, but your spouse said that you were going to bed looking at chat GPT, wondering what activities you can do in retirement. So we really want to make sure your spouse as well as yourself have a really detailed planning process and we want to make sure both of you feel equally heard. That's the topic for today's episode.
Speaker 2:That's the topic and the reason for that, the reason that we've been talking about this and, yes, this is we'll talk about root for a second. So why do we require a spouse, or both spouses, to be involved if someone's married to go through this? It's because people have this perception that, okay, we need to get our financial plan done. That's something I can do. It's almost like I need to go to the grocery store and buy this. I can take care of that. My spouse will take care of the other thing. You go pick up the dry cleaning, I go pick up the Cheerios, and it seems like that divide and conquer and it's done.
Speaker 2:The financial plan is not just a math problem to be done. I think that's most people's perception Run the Excel scenarios, run the financial planning scenarios. Whatever it is, I'll take this back, I'll communicate it to my spouse and we'll be good. And that's the wrong way to look at it. People look at the financial plan as like the thing that they are getting or is the final product, whereas the financial plan is just a means to an ends. I think that oftentimes, when there is a spouse that's not as involved for me, for example I tend to be the one that's doing a lot of the money stuff in our household. My wife, ashlyn, is not doing nearly as much as it. So I, if I was going to financial planner, might say hey, ari, I want to work with you. Um, I kind of handle all the financial stuff. Uh, ashton doesn't need to be here, uh, let's go ahead and get started. And your response to me you would you would say, well, we're not going to get started until Ashton's here. And the reason for that isn't because, oh, she needs to understand what we're optimizing a portfolio allocation. That's not why. The reason why is because the financial plan is simply a means to an ends. It's the thing that we do that says how do we get to where we want to be? How do we have that successful outcome? How do we reach the future that we've envisioned? And that future that we've envisioned is not something that Ashlyn delegates to me or I delegate to her. That has to be something that we talk about together. What are our dreams for our family? What are our dreams for where we want to be? What is the thing that's most important to us? What are our values? What do we want reflected, if she never understands what the actual 401k allocation is or something that's no big deal, but she has to be very involved in understanding. Here's what we're trying to do. Here are the trade-offs we're making along the way. Here's what we're saying no to, so that we can say yes to this.
Speaker 2:And to your point, ari, which is a great one, when we do meet with clients and one spouse kind of tends to lead it, and we make sure that most spouses, or both spouses, are involved to understand from both sides what's important to you, what are your concerns, all that stuff We'll have spouses. They'll go on for a while. Here's what we want to do. Here's all this.
Speaker 2:And then we'll ask the other spouse what do you think about that? Hey, alice, what do you think about what Ari just said? And Alice says well, ari says that he's going to struggle when he's not working every day because he loves the people he works with and he gets a true sense of purpose out of that. He didn't tell that to you, but I can tell as his spouse, even if I don't understand all the intricate workings of the financial stuff I get this about, ari, and so your spouse is going to see your blind spots and you might not recognize that, and that's because they're blind spots. You don't see them by nature.
Speaker 2:And so, having that sense of we want to talk to the person that knows you best, and we want to do that to both of you, to understand the both of you. And we want to talk about not money, we're not telling the spouse to come on the call so we can talk about, as I mentioned, standard deviation and take you to 50 pages of charts of things that are going to make your eyes who cares? I'm bored by that stuff. What I want to know is what does success like? What are you excited about? What do you hope for? What do you hope you never have to do a day again in your life in the future? What are the things you most value spending money on? Tell me about some of the favorite trips you've like. Those are the types of things that both spouses, whether they're the money person or not, are going to have something impactful to say about, and you cannot have a well-designed plan until you truly understand that component first.
Speaker 1:My mom used to feel so guilty going into her advisor's office her old advisor and the advisor would show a graph with green colors and red colors and my mom would always feel bad because she used to always ask them to explain more. She felt like she was a burden by asking questions. She said I see the graphs. Advisor, I see you're excited about this. I'm not trying to take your excitement away. I just don't understand what this means. And my mom never really got to have her own financial plan ever, and it's because she was scared to ask the question.
Speaker 1:It wasn't an open space and what I imagine happened is in the first meeting, james would have walked into Ari's office and in this hypothetical, ari would have said James, it does sound like you're the guy who manages the finances and Ashlyn's not here and her schedule is really busy. So because of that, yeah, let's just go ahead and get started. That advisor did what he thought was the right thing to help James. It's hard for an advisor to say I'm really sorry, james, I can't help you today, and James is saying no, you don't understand. I don't know if you heard me. I'm the one that manages it.
Speaker 1:And for Ari, in that case he would have to say no, I heard you fully, I can't work with you yet. That's really difficult because a lot of advisors they want more clients, they're trying to grow their business. So at root we are very transparent. We want advisors who are actually excited to execute true planning, which sometimes does mean having to reschedule so that we can really make sure that conversation is meaningful. James, I know that sometimes you'll come up with these really magical questions, whether you think they're magical or not, that help clients really open up. Do you mind sharing some of those questions?
Speaker 2:Yeah, there's a few, and I think if you want better answers, obviously ask better questions. If you want better outcomes, ask better questions. And so sometimes what I don't like is a question of okay, mr and Mrs Client, tell me what your goals are. Morgan Housel had an awesome blog post on this, where the reason I don't. I know this is not the right way of saying it, but I don't trust a lot of people when they tell me what those goals are, because I can tell I don't think those are your goals. I think that you've maybe never spent enough time actually thinking already about what you want, and so if you've never spent time thinking about what you want, you're naturally just going to think that you want what the most successful people around you are, or have Nicer cars, bigger homes, sending your kids to nicer schools. So those become the goals that you state, not because that's actually what you want, but because it takes time and deep thought and reflection and not just being caught up and consumed by the demands of the world and the culture. It's who, what do I want, what do I actually want this to be? And so how do you get people to truly understand, or how do you help people to truly understand what they want to do, and sometimes you try to ask questions around what do you enjoy spending money on? What's your favorite purchase that you've ever made?
Speaker 2:But one question that we like is around, and this comes up more so just to paint a picture of people who have saved a lot, they've invested a lot, they've worked. They now are in this position where they maybe have a scarcity mindset of I'm never going to have enough to retire, and so that scarcity mindset really drove. Living beneath their means, saving a lot, investing a lot, growing this portfolio we say, hey, not only can you retire today if you wanted, but you can actually spend significantly more than you ever thought you could because you built up this portfolio to do so. And what they struggle with is they struggle to actually spend the money. They say we know we can, but there's a difference between logically understanding that I can do something and psychologically being able to bring myself to actually do that thing. And so one question that's just kind of a fun thought exercise for people that struggle to spend is already if you and Alice came to me and it was like, ah, we know we could spend 150,000 per year, but we just, we're only going to spend 90, because that's that's all we need. That allows us to pay our property taxes, that allows us to put food on the table. We're not doing anything like real fancy, we're not playing soccer much, we're not traveling much, we're not doing anything that we actually want to do, but $90,000 meets our needs.
Speaker 2:If I know that there's, in this simple example, $60,000 more that you could spend sustainably, safely, a question I might ask you is Ari, you have an option. Ari, you have an option. You can either go spend $60,000 more per year or, if you don't, I'm going to take that $60,000 from your portfolio and I'm going to donate it to your least favorite political party or political figure. And I didn't make up this question.
Speaker 2:This question comes up, but it's this sense of almost like you know that that would you rather game. Would you rather do this horrible thing or that horrible thing? And and sometimes it's it's it makes you even uncomfortable thinking about it. It's like, oh, they both sound so horrible. You get caught up. And it's like, well, they're both, they're not true, you don't have to do either of them.
Speaker 2:But how do we paint this picture of? If you don't spend it? It's not just going to be wasted, it's going to be donated to something that you believe strongly against, and so I would ask that, and I would just be quiet. It's uncomfortable thinking about it, but it's this way of saying. If you were forced to do this thing, I'm not telling you actually have to go do it, but the first step to doing something, action is just going to be the thing that is the byproduct of thinking through what we actually want to do. So what do you want to do, ari? What's important to you and Alice? We don't need to start with things, but is it travel? Is it health? Is it relationships? Let's start there, and then we can start thinking through what types of things would be most helpful to spend money on.
Speaker 1:That is my favorite question and all of you. I wish you could see. When we've asked any of our advisors have asked a client that question. You would be shocked by the discomfort you see, followed by how quick they come up with answers. And I have done this in a meeting where someone has said that same example 90,000.
Speaker 1:James, I know I said that was my need, but the truth is that is my want and that's everything. I truly can't spend more. And James would give the example Okay, then it's going to your least favorite political party and you'd think they'd go. Well, then I guess that's where it's going. I have nothing else I could do, and how quickly people go. I mean, I would start my own foundation. I would donate more money. In fact, you said in an earlier meeting that maybe we should do that charitable account. Should we do that now? Because I think that would actually help. And you know what We've been meaning to get our kids more invested in how we're giving, and so maybe that would be good for them. And you know they didn't start their Roth IRA. What if we gave them half of the max? Then they started going to work earlier and they start spinning in a way that they never would have without that question.
Speaker 2:And this goes back to why do we, if someone's married, why do we require their spouse to be part of the process? If we're going to take them through it, obviously you can go to anywhere and do it yourself. That's your money. But if we're going to be the advisors in this, that is one of our standards. There is a beautiful alignment. That happens when, If I'm talking to Ashlyn and we're talking about budgets and we're talking about investments, it's not like a super unifying conversation.
Speaker 2:It's not one of us likes that, one of us doesn't. But if I'm talking to Ashlyn about the future that we both envision, what do we want to do? Who do we want to give to? Where do we want to spend? How do we want to create the environment that we will? That's something that both of us are going to be fully aligned with and it creates this sense of connection that you're going to get when you and your spouse both talk through these things. Or Ashton might be able to say James, you've always really wanted to do this, and it's like oh, yeah, yeah that's what you know.
Speaker 2:That sense of that was a blind spot of mine. But that is important to me, but my spouse knew. So that's just another talk about with your spouse. Those are the things we want to unify around. The financial part is kind of the easy part Once you know what we're trying to do, what we're aiming for, what we're trying to create, the finances. Our job is to align those in a way to help support getting there. But we can't cast that vision for someone that has to come from both parties in a way that only happens when both spouses are involved.
Speaker 1:Beautifully said. And final thing here we recognize you are humans, you're not robots. We have had many instances where a certain spouse will say look, I really would appreciate if you would go above and beyond and meet with me one more time, just so I can fully understand why we're going to decide to fill up this certain tax bracket and, if you don't mind, we could record that, because my spouse can't make it for that one meeting. There are instances where, of course, we go yes, that's an option. We want to make sure you are fully in the loop and that your questions are answered.
Speaker 1:But too often we find advisors will say, yeah, don't worry about it this time, and then it's the next time, and then we haven't seen them in a year. And now we're wondering okay, is it just you driving it and is it still a team effort here? So, yes, we want you to be transparent. You are your own individual people. We just do ask oftentimes if it's okay that we record the meeting so that if there's something that comes up, we can go ahead and make sure your spouse feels heard. So we do require spouses on meetings, but we do also want to make sure that the way you correspond with your spouse is probably different than your neighbor and your coworker and friend, and we take all that into consideration. So anything else for today's episode, james.
Speaker 2:Just to take Root out of this. Who cares what Root does? Everyone should talk to their spouse about this type of thing not the financial side, but what are we actually trying to do? Whether you're working with Root, you're working with another advisor, you're doing it on your own, you're going to have better outcomes, especially when those trade-offs have to be made.
Speaker 2:Okay, we only have so much money. Do we use it to send our kids to this type of a school or do we use it to create this type of family vacation, to create the memories with our family? Those are the types of things that, hopefully, both spouses are coming together and talking about and not always seem perfectly eye to eye, so this is less about root and what root requires. The reason we require this, though, is because, in general, everyone has different philosophies on what you know. When you're married combining money, whatever Get aligned on what you want to do, and then the method by which you get there is going to become a lot easier, and you're going to be closer as spouses when you're able to have those types of conversations together very important clarification there, so thank you for that.
Speaker 1:If you ever want to put your spouse to sleep really quickly who's traditionally not involved in finances you can throw on one of our roth conversion verse healthcare subsidy episodes and they'll be out like that. So we are here to support you as you need it now. Joking, this is what we love to do here at Root. We want to make sure you and your spouse are heard, so everything you work so hard for can come to fruition and you don't have a new job having to do this in retirement. If this is the type of services that you're looking for the tax, the estate, the healthcare, the withdrawal, the insurance it's what we love to do. If you go to rootfinancialcom, in the upper right you'll see a little button that says click here to see if you're a fit. If you click on that, you'll be asked a few questions and we look forward to hearing from you there.
Speaker 1:James has his own individual YouTube channel under James Canole. He also has a podcast ready for retirement. I have my YouTube channel under my name, ari Taublieb Early Retirement. I will come up right on YouTube as well as the podcast, early Retirement. This is our joint show, root Talks where we get to answer your questions that are left in our free community, the Root Collective. You can join that in the description below if you're not already in there. There's over 3,100 members as of today. So go in there, look around, see if there's something that piques your interest and if you want. So go in there, look around, see if there's something that piques your interest and, if you want, drop a question or comment and we'll look to answer it in a future episode. See you guys next time. Thank you.
