Retirement Planning Brings Stress to Couples

BOSTON (TheStreet) -- Wedded bliss frequently turns to rancor when it comes to financial matters.

A recent survey by Fidelity Investments found that retirement planning is a particularly prickly prospect for married couples, with only a small percentage expressing confidence in each other's abilities to manage their finances.

The matrimonial discord is detailed in the firm's Couples Retirement Study. Fidelity reached its conclusions after talking to more than 500 married couples, including baby boomers and older pre-retirees.

The study found that less than half of couples make routine financial decisions, such as budgeting and paying bills, together. Only 38% jointly discuss their investment and savings strategies for retirement.

"A startling statistic is that if something happened to one spouse, only 15% of the couples felt that the other spouse could manage the finances," says Joan Bloom, executive vice president of Fidelity Investments Life Insurance. "The fact that people don't really understand what they own as a couple, and where assets are located, could have a serious impact on a surviving spouse."

Nearly 10% fewer couples said they had taken long-term steps such as creating an estate or a retirement plan compared to 2007.

"We actually thought the amount of planning people are doing for retirement would go up, given the market uncertainty, but it actually went down," says Bloom. "Money is a hard thing to talk about and I think, because many people again saw their assets going down, it made it more difficult to talk about their future, planning for it and how they are managing finances."

Couples who don't plan are more likely to overspend or make bad decisions that compromise their ability to travel or enjoy their leisure time, she says.

According to the survey, 60% of couples don't agree on their respective retirement ages, 44% don't agree about whether they will work in retirement and 42% have different ideas about their expected lifestyle in retirement. Only 49% of couples surveyed expect to live comfortably.

Fidelity's study showed that although ownership of retirement investment products remains at "high levels," there's still confusion among couples regarding what they own and how these products work. For example, 39% of couples didn't agree on whether they owned an annuity and less than one-quarter of couples knew the amount of money their annuity would generate for them in retirement.

Fifty-nine percent of couples agreed that they owned an individual retirement account, or IRA, while 26% didn't agree. In one in 10 couples, one spouse didn't know when they could begin withdrawing funds from their own IRA.

Susan C. Elser, an Indianapolis-based financial adviser, frequently deals with financial strife in couples. She says heightened tension is natural after the stock market has sapped so many people's 401(k) funds and investment accounts. Often one person is making the financial decisions for the couple, and he or she is blamed when things go wrong.

"In almost every marriage, there is one person who handles the finances and one person who gets dragged to the meeting with a financial planner and really has a low level of interest," she says. "But you have to share responsibility, even though one person may be handling the details."

Bloom says couples don't need to divide and conquer when it comes to managing their finances, but it's critical that they take time to make long-term plans together.