05.12.2022

A guide to navigating finances for spouses with age differences

Spouses who have a large age differential must confront several unique financial planning issues. These issues raise many questions – here are some of the more common ones we hear:

How do I make sure my spouse is provided for?

Establish a team of advisors consisting of sensitive, ethical, collaborative individuals who your spouse is familiar and comfortable with, and will place trust in. Then set up foundational elements such as a will, trust, and financial plan. Investment policy should be designed based on the life expectancy of the younger spouse.

What if my spouse isn’t that involved with the household finances at the moment, and is overwhelmed without me?

This is an avoidable scenario if you establish relationships ahead of time with advisors that your spouse is familiar and comfortable with, and who can explain concepts in a clear way that engenders a sense of comfort rather than confusion. It is best for these relationships to be established a long time before any life changes occur, to lessen the impact of surprise at a time of transition.

What if unscrupulous people try to covet my spouse’s money after I’m gone?

This is a common problem faced by wealthy people. There are numerous safeguards that can be put in place to defend your family, many having to do with setting up technology and legal safeguards.

How do I ensure that the interests of all parties involved (my children, my spouse, my spouse’s children, grandchildren, other dependents, etc.) will be met in my absence?

This is a matter of having a clear vision for what the needs are of the parties involved, and establishing a plan for the equitable distribution of resources. Avoiding “accidental disinheritance” is always a primary consideration in these situations. Once this is made clear and agreed upon, there are legal structures that can be put in place to uphold that vision.

What if one of my beneficiaries wants to use money inherited from me to do something (such as giving it to someone or spending it on something) that I wouldn’t have wanted them to?

There is no way to control what a person does with money that has been irrevocably given to them. In extreme cases, if the person is incapacitated, incapable of handling the funds responsibly, or a minor, the solution would be to award control of those funds to a professional third party conservator who will manage their financial affairs based on the requirements and criteria you stipulate.

Who will run my business? How will my spouse run a business?

Spouses of business owners who pass away are faced with the decision to either sell, continue the business themselves, work with the existing management team in place, or hire a new management team to run it for them. A well-chosen team of advisors can play a valuable and objective role in all aspects of this transition process.

How can I help my spouse deal with social isolation that may happen because they are of a different generation than our friends?

It’s impossible to know how someone will treat you based upon age differences. Some people may grow apart from you, and others won’t. The best remedy is to ensure that you both have numerous social outlets and a full range of options so you can enjoy life instead of being faced with seclusion!

How do I help my spouse deal with the anguish of loss?

Grief can be managed through support mechanisms such as therapy and self care. It is useful to prepare as much as possible in advance by putting necessary resources in place to minimize the instability that can occur during these times.

How can I ensure that my legacy will live on?

Your team of advisors can collaborate to help you lay out a plan for continuing and furthering your legacy. It’s a matter of identifying the key values you want to make live on, and then specifying the ways to make it do so through philanthropy, family events, etc.

 

 

A family is a dynamic system, one that is always changing. While it is never pleasant to think about the change that time inevitably brings, the best outcomes are reached through forthright, intentional planning that is re-visited on a regular basis. It is your best defense from the chaos that can ensue when transitional events occur.

The information we’ve presented is intended to serve as a starting point for discussion. They are not answers, because there are no simple answers for real life situations such as those with multiple dimensions, personalities, and needs to take into account.