Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
For couples: separate or combined accounts in retirement
Old 03-13-2014, 08:43 AM   #1
Full time employment: Posting here.
 
Join Date: Feb 2014
Posts: 731
For couples: separate or combined accounts in retirement

Up until now my DW and I have had separate accounts for savings, checking and after tax investments. And, obviously, we have different tax deferred accounts with our respective employers.

We've taken a very pragmatic approach of his and her money and we settle up the bills at the end of the month.

For us....it has worked well.

In retirement however, I was thinking that it may be more pragmatic and easier on both of us as we get older to 'downsize' to single joint checking and savings and combined brokerage accounts.

Was wondering how other couples here in retirement approach the separate vs joint 'paradigm'.
__________________

__________________
BBQ-Nut is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-13-2014, 08:46 AM   #2
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,119
If what you have is working for you, I'd keep it.
__________________

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 03-13-2014, 08:50 AM   #3
Moderator
Walt34's Avatar
 
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 16,544
One of the issues to consider is that if one gets seriously sick and needs to go on Medicaid is that the entirety of amounts in joint accounts are subject to the "five-year lookback". If the accounts have been separate for longer they are not considered part of the assets for that person.

So if what you've been doing works for you then that is one reason not to change it.
__________________
I heard the call to do nothing. So I answered it.
Walt34 is offline   Reply With Quote
Old 03-13-2014, 08:57 AM   #4
Thinks s/he gets paid by the post
seraphim's Avatar
 
Join Date: Mar 2012
Posts: 1,492
Retirement - tax deferred - accounts are separate by necessary. Everything else joint. In case of one of us passing, avoids having some funds frozen in an account. The other can just transfer the funds to a different account. Might save in any estate taxes as well.
__________________
"Growing old is no excuse for growing up."
seraphim is offline   Reply With Quote
Old 03-13-2014, 09:01 AM   #5
Thinks s/he gets paid by the post
seraphim's Avatar
 
Join Date: Mar 2012
Posts: 1,492
"One of the issues to consider is that if one gets seriously sick and needs to go on Medicaid is that the entirety of amounts in joint accounts are subject to the "five-year lookback". If the accounts have been separate for longer they are not considered part of the assets for that person."

Walt, I've had a attorney who specializes in senior services advise that accounts don't have to be joint for the government to get its reimbursement. Might depend on the type of account. Might be something to check...
__________________
"Growing old is no excuse for growing up."
seraphim is offline   Reply With Quote
Old 03-13-2014, 09:49 AM   #6
Thinks s/he gets paid by the post
Dash man's Avatar
 
Join Date: Mar 2013
Location: Limerick
Posts: 1,670
We do some of both. The majority of our taxable accounts are in either a joint asset management account or joint CD accounts. We do each maintain some taxable funds in separate checking and savings accounts to allow some privacy in personal spending. All of our community bills are paid for out of our asset management account. If we buy gifts or help out our respective families, it usually comes out of our individual account. It works well for us.
__________________
Dash man is online now   Reply With Quote
Old 03-13-2014, 09:55 AM   #7
Thinks s/he gets paid by the post
 
Join Date: Jan 2005
Posts: 2,555
Everything is in joint accounts, except for the tax deferred. We have done it this way for 41 years.
__________________
Dreamer is offline   Reply With Quote
Old 03-13-2014, 10:02 AM   #8
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 8,817
Quote:
Originally Posted by Walt34 View Post
One of the issues to consider is that if one gets seriously sick and needs to go on Medicaid is that the entirety of amounts in joint accounts are subject to the "five-year lookback". If the accounts have been separate for longer they are not considered part of the assets for that person.

So if what you've been doing works for you then that is one reason not to change it.
I don't think the titling of the account makes a difference in medicaid look back. I had to research this for my inlaws when my FIL was going into a home.
Retirement accounts (IRAs, 401ks) are titled separately, but considered as assets in the medicaid spend down - even if they're in the community spouse's name., Pretty much ALL assets are considered and handles as jointly owned, regardless of titles on the accounts or deeds. Then the spend down and community spouse rules are applied.
Spouses of Medicaid Long-Term Care Recipients
http://www.medicaid.gov/Medicaid-CHI...hment-2014.pdf
__________________
rodi is offline   Reply With Quote
Old 03-13-2014, 10:03 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,446
Quote:
Originally Posted by REWahoo View Post
If what you have is working for you, I'd keep it.
+1 though that is not what we do.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 03-13-2014, 11:01 AM   #10
Thinks s/he gets paid by the post
walkinwood's Avatar
 
Join Date: Jul 2006
Location: Denver
Posts: 2,676
Quote:
Originally Posted by REWahoo View Post
If what you have is working for you, I'd keep it.
+1, but we have joint accounts where possible. We merged them a few years after getting married.
__________________
walkinwood is offline   Reply With Quote
Old 03-13-2014, 11:31 AM   #11
Thinks s/he gets paid by the post
 
Join Date: Apr 2011
Posts: 1,558
Quote:
Originally Posted by BBQ-Nut View Post
Up until now my DW and I have had separate accounts for savings, checking and after tax investments. And, obviously, we have different tax deferred accounts with our respective employers.

We've taken a very pragmatic approach of his and her money and we settle up the bills at the end of the month.

For us....it has worked well.

In retirement however, I was thinking that it may be more pragmatic and easier on both of us as we get older to 'downsize' to single joint checking and savings and combined brokerage accounts.

Was wondering how other couples here in retirement approach the separate vs joint 'paradigm'.
With joint, you wouldn't have the work of settling up bills at the end of the month. Perhaps it's a bonding experience, but to me seems a hassle. Of course this is coming from someone who's accounts have always been joint.

The other thought is joint allows the other person to deal with all finances in the event one is disabled from doing so. Don't know who's managing your brokerage accounts, but if not you it would allow whomever is to do AA clearly for the both of you.
__________________
gerntz is offline   Reply With Quote
Old 03-13-2014, 12:08 PM   #12
Thinks s/he gets paid by the post
38Chevy454's Avatar
 
Join Date: Sep 2013
Location: Cincinnati, OH
Posts: 1,584
Quote:
Originally Posted by Dreamer View Post
Everything is in joint accounts, except for the tax deferred. We have done it this way for 41 years.
Same for me and wife, but 21 years length of time. Plan to be this way for many more!

For OP, since you have been working it separate for long time, why change now?
__________________
After Monday & Tuesday even the calendar says, W-T-F...

Semi-Retired 7/1/16: working part-time (60%) for now [4/24/16 changed to 80%]
Retired Aug 2, 2017; age 53
38Chevy454 is offline   Reply With Quote
Old 03-13-2014, 12:35 PM   #13
Thinks s/he gets paid by the post
Live And Learn's Avatar
 
Join Date: Feb 2012
Location: Tampa Bay Area
Posts: 1,689
Quote:
Originally Posted by 38Chevy454 View Post
Same for me and wife, but 21 years length of time. Plan to be this way for many more!

For OP, since you have been working it separate for long time, why change now?
+1. Been married nearly 30 years and there was not enough money to worry about his/mine/ours at the time so all accounts (except 401ks) are combined. We each get the same "monthly allowance" for spending money (no questions asked on what the money was spent on). Everything else is joint.

If separate has worked for you why change ? Would you each be ok with getting "an allowance" - if not then it may be a little stressful, at least at first.
__________________
"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11

ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
Live And Learn is offline   Reply With Quote
Old 03-13-2014, 12:56 PM   #14
Recycles dryer sheets
 
Join Date: Aug 2011
Location: Atlanta
Posts: 420
Quote:
Originally Posted by seraphim View Post
"One of the issues to consider is that if one gets seriously sick and needs to go on Medicaid is that the entirety of amounts in joint accounts are subject to the "five-year lookback". If the accounts have been separate for longer they are not considered part of the assets for that person."

Walt, I've had a attorney who specializes in senior services advise that accounts don't have to be joint for the government to get its reimbursement. Might depend on the type of account. Might be something to check...
or what State you are in, which could change ..
__________________
SJ1_ is offline   Reply With Quote
Old 03-13-2014, 01:31 PM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Apr 2013
Posts: 5,587
Quote:
Originally Posted by SJ1_ View Post
or what State you are in, which could change ..
+1 We saw that when our parents lived in an elder friendly state. Unfortunately to have children to care for them, they had to move. Where they moved that state's elder laws were very friendly too, friendly for the state.
MRG
__________________
MRG is offline   Reply With Quote
Old 03-13-2014, 03:14 PM   #16
Recycles dryer sheets
 
Join Date: Jul 2013
Location: Villa Grande
Posts: 259
My DH and I did exactly what the OP is contemplating and it is working well. When we were both earning salaries it made sense to have separate bank accounts. Having a single checking account now from which we both pay expenses makes it easier to track how we are doing viz our budget.
__________________
TimSF is offline   Reply With Quote
Old 03-13-2014, 05:38 PM   #17
Moderator
Walt34's Avatar
 
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 16,544
Quote:
Originally Posted by seraphim View Post
Walt, I've had a attorney who specializes in senior services advise that accounts don't have to be joint for the government to get its reimbursement. Might depend on the type of account. Might be something to check...
Apparently I was either misinformed or misunderstood what I was told, the latter being more likely....

From http://aspe.hhs.gov/daltcp/reports/spouses.htm:

Quote:
Basic Medicaid income and asset eligibility rules for married couples:
  1. All income and assets (his, hers and theirs) are combined, regardless of ownership, including things that are often the sole legal property of just one spouse -- for example, retirement savings accounts or pension checks.
  2. If either spouse has an interest in property with a legal right to sell, claim or cash it out in some manner to obtain money for his or her personal use, then the fair market value of that property is counted to the extent of the spouse’s legal right to convert it to cash.
  3. The rules for couples living apart differ from those for couples living together, as the income of a community spouse is not considered to be available to an institutionalized spouse. Medicaid rules encourage married couples to choose nursing home rather than in-home care for an ill spouse in order to preserve additional income and marital assets for use by the community spouse.6
__________________
I heard the call to do nothing. So I answered it.
Walt34 is offline   Reply With Quote
Old 03-13-2014, 07:33 PM   #18
Moderator
Alan's Avatar
 
Join Date: Jul 2005
Location: Eee Bah Gum
Posts: 21,113
We've had joint accounts for 38 years then in January this year we split the money into his and hers. The reason is that we'll be returning to the UK in a couple of years and the tax code does not account for marriage. Everyone files as individuals, so to minimize taxes it is better to split the income streams to maximize the zero and 20% tax bands and to double the cap gains 0% tax allowance to $34k.

After splitting the accounts to individual accounts we set up "Agent Authorizations" so that we each have full authority over each others' accounts.
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Now it's adventure before dementia
Alan is online now   Reply With Quote
Old 03-14-2014, 12:13 AM   #19
Thinks s/he gets paid by the post
Rambler's Avatar
 
Join Date: Jul 2007
Posts: 2,250
Joint accts since our wedding, nearly 30 years ago. Everything except the 401k and deferred comp, and a work related vested stock acct. She is the beneficiary on all of those.
__________________
Find Joy in the Journey...
Rambler is offline   Reply With Quote
Old 03-14-2014, 09:13 AM   #20
Thinks s/he gets paid by the post
RetireAge50's Avatar
 
Join Date: Aug 2013
Posts: 1,121
Same as Rambler except 25 years. Clean and simple.
__________________

__________________
RetireAge50 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
HSA Questions (relating to spouse over 55, separate accounts) 45th Birthday Health and Early Retirement 5 01-25-2014 11:58 AM
Joint v Separate Accounts? Sassy FIRE and Money 55 06-05-2013 06:45 PM
Long term loss combined with long term gain dmpi FIRE and Money 9 12-21-2012 04:27 PM
When calculating worth do you look at combined or individual total assets? 01drummer Young Dreamers 74 07-26-2011 11:49 AM

 

 
All times are GMT -6. The time now is 07:27 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.