Couples putting partner's finances at risk by failing to talk

5 October 2016

Only a third of over-40s have ensured their partner will still have an income in retirement if they die first, according to a new study from Prudential.

More than one in five couples have never discussed their retirement finances at all, while one in 10 last bought the matter up more than six years ago.

Perhaps unsurprisingly it is women’s finances that are most at risk by this failure to communicate. One in 10 women is completely reliant on their partner’s pension and a further 13% expect their income to come wholly from the state pension.


Couples that have discussed their retirement finances expect to have a joint annual income of £28,500 – however this income could be at risk if they fail to put in place plans that would ensure an income is paid to a surviving spouse if the pension owner dies first. Prudential says that three in 10 people have pensions that will only pay an income direct to them.

The research also found that 62% of over-40s have no idea how much they will have to live on when they retire, while 18% do not know how much their other half has saved in a pension.

Kirsty Anderson, a retirement income expert at Prudential, says: “Life is busy for everyone and it’s tempting to avoid difficult conversations, but couples really do need to talk about their finances and retirement planning in particular. A conversation about what might happen to a couple’s finances if the worst should happen to one partner can be particularly difficult but it could make the difference between the survivor being left with nothing or having a comfortable retirement."


She adds: “Couples who don’t talk about their retirement finances may end up making plans separately and missing out on making the most of the pension saving tax relief available between them. They may also have unrealistic expectations of what their combined retirement savings are worth.”

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