Managing Marriage and Money Issues

For many pre-retirees, some of the most intense disputes occur when their kids graduate from college or when adult children going through unemployment or divorce wind up coming back to live at home.

"The whole boomerang kids issue is really tough for older couples," says Bethany Palmer, who along with her husband, Scott Palmer, operates TheMoneyCouple.com, a business that helps couples sort through thorny money matters.

She says retirees are often at odds over whether to charge their adult children rent, what bills (if any) the couple should require their kids to pay and how to best offer support without enabling an adult child.

"Maybe a son is unemployed or one of their kids returning home is a single mom, so there are grandkids too," Palmer notes. "There can be horrible arguments if you have a father saying: 'I did everything for myself; our son has to go out on his own.' But the mother is saying: 'There are no jobs' or 'It's our job to help.' "

The solution, Palmer says, is that parents must "become a united front" and jointly establish limits to their financial generosity. Then they must clearly express those limitations to their adult children.

3. When to retire

A recent Fidelity Investments study found that nearly two-thirds of couples approaching retirement age disagree on when each of them should wrap up the working life. Sometimes one spouse fears there isn't enough money amassed for retirement. Other times, one party wants to keep working or maintain a salary as a way to have financial independence.

Whatever the root causes, experts say the best way to overcome this challenge is to start a conversation about retirement expectations as early as possible.

"Millions of American couples have worked very hard to save for retirement," says Kathleen A. Murphy, president of Personal Investing at Fidelity. "However, far too many don't take the time, or have the comfort level, to jointly discuss their plans for the future.

"To ensure alignment between spouses, and the best course of action, couples should sit down long before they retire to discuss key financial topics such as when they plan to retire, where they want to live, whether they plan to work and what lifestyle they hope to enjoy."

4. Risk versus security

Older couples also frequently bicker over what Bethany Palmer calls the "risk versus security" dilemma.

Sometimes it manifests itself with investments: One partner is more risk-tolerant and wants to invest heavily in stocks, while the other spouse is risk-averse and prefers to stick with safer assets like bonds or certificates of deposit.

Beyond investing, couples wrestle over business and entrepreneurial opportunities, second-career options, or even just going back to school, all of which have huge financial implications.

"Age 50 is such a turning point for most people," Palmer notes. "That's when people often start thinking: 'I've always wanted to get my law degree' or 'I really wanted to do this or that my whole life.' "

But since "most of us marry our money opposite," she says, conflicts can arise if a risk-taking spouse wants to do something after age 50 that his or her "security-focused" partner can't tolerate.

The more conservative spouse may be saying: "It's too late" or "You're over 50."

The best answer for this dilemma is to have a plan B and think through best- and worst-case scenarios and then decide whether both parties could live with the outcomes.

For example, if making a high-risk investment or pouring money into a speculative business venture is under consideration, you and your mate should contemplate how you would fare if you lost all your money. That's always a possibility.

The two of you need to be on the same page before making any big move that could be economically risky in the long-term. But other questions, like pursuing a new job opportunity, need not be viewed as such a high-stakes proposition.

Palmer cites an older couple she knows in which the wife, after turning age 50, told her husband that she wanted to become a flight attendant. He wasn't ready to support the idea. But the couple talked through it and ultimately the husband recognized that it was his wife's lifelong dream. She did it for 10 years, loved it, and the couple fared just fine, Palmer says.

5. Keep or sell the home? Upsize or downsize?

Making a decision about the home once the kids have moved out is complex for people in their 50s, 60s and beyond because they must grapple with numerous, sometimes competing, goals. They often want to be closer to their kids or grandkids, but not overly close or intrusive. They want cheaper housing, but also wonder whether they should keep a larger home in case relatives visit.

One spouse may favor throwing traditional thinking out the window to refinance the house, pull out equity and buy a second place. "A lot of creative things are being done that never would've been done in the old days, because having your house paid off before you retire is financial planning 101," says Scott Palmer, who with his wife wrote the book First Comes Love, Then Comes Money.

Coming to terms "causes tension for older couples because sometimes the home is one person's security, and for the other person it's an investment," Palmer says.

Reaching a workable solution often requires creativity, and a willingness to take a realistic look at the family budget. It's important to make a list of priorities, itemizing the things a couple must have (like a home in a specific state, little to no mortgage and one guest bedroom) versus the things that are simply nice to have (such as a family room, pool or backyard for the grandchildren).

For those contemplating selling the family home and relocating to another city, it's smart to try out that new town for size first — perhaps by renting for a year — to see whether you really do like the area before buying a home.

Ultimately, resolving these and other tricky money dilemmas is possible, Palmer says. His proof? Last year, his grandparents celebrated their 70th wedding anniversary.

Lynnette Khalfani-Cox, The Money Coach®, is a personal finance expert, a television and radio personality, and a regular contributor to AARP. You can follow her on Twitter and on Facebook.