Advisers should encourage married women approaching retirement to take a more active role in managing their finances as many depend on their partners to sort out their affairs, HLB Mann Judd has suggested.
In a statement, HLB Mann Judd Sydney head of wealth management Michael Hutton warned that, for many couples in the baby boomer age group, the husband continues to control all the family’s finances.
“While this has changed for subsequent generations, I believe that over half of all self-funded women retiring have not really been involved in financial decisions and as a result don’t have the full picture of how their superannuation or other investments work,” he said.
This dynamic could cause problems if the husband dies before the wife, which is statistically likely, he suggested.
He said such couples should be encouraged to follow the “4D approach” to managing their finances, namely “discuss, decide, disclose and devolve.”
“Communication is essential so even though one of the spouses might find it boring, couples should discuss their financial situation regularly, including what the options are and why decisions were made,” he said.
“If both partners are involved in making financial decisions then inevitably understanding is improved, and probably better decisions are made.”
He also said the person managing the finances should clearly explain the family’s arrangements to their partner, including which accounts, assets or instruments exist and how they work.
Finally, partners must take equal responsibility for financial matters, including authorisation to action accounts, Mr Hutton suggested.
“Involvement of both partners will immediately help improve understanding, and increase the comfort level of both,” Mr Hutton said.
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 10:31Industry veteran joins Bondi boutique’s boardBy Aleks Vickovich
- 10:31Invest in next generation, says AWSBy Staff Reporter
- 22 Aug 2017O’Dwyer announces EDR transition panelBy Staff Reporter
- 10:31ASIC reveals recent enforcement activityBy Larissa Waterson
- 22 Aug 2017Advisers must become ‘lifestyle coaches’: ZurichBy Jessica Yun
- 22 Aug 2017Elders signs 18th advice practiceBy Staff Reporter
- view all