From the March 2009 issue of Investment Advisor • Subscribe!

The Psychology of Advice: Power Couple

Couples contemplating retirement aren't always singing the same song

Much has been made of the fact that baby boomers are nearing retirement age, but that doesn't mean boomers and their spouses will necessarily be in sync with each other. Take actor Michael Douglas, for example. If he retires next year when he's eligible for a full Social Security benefit, he'll have to wait 26 years for Catherine Zeta-Jones to qualify for a full retirement check of her own. That's a long time to postpone enjoying your golden years with your spouse! Then take a look at it from her point of view: How would you like to work for the next 26 years while your carefree mate goes golfing or lounges by the pool?

Aside from age differences, complications can also ensue when one partner enjoys her work while the other wants to quit, or (an increasing likelihood amid today's perfect economic storm) a continuing paycheck is needed to keep the marital ship afloat. If they're both retiring, one spouse may want to move closer to the children while the other yearns for adventure. A spouse who wants to relax and have fun may be at odds with a mate who prefers active philanthropy. I've also seen situations where one partner longs to simplify life while the other craves the affluent lifestyle they've enjoyed for years.

In short, maintaining a harmonious relationship after one (or both) retire can be tricky for couples who don't have the resources of Hollywood mega-stars.

Money, Power, and Polarity

When conflicts arise among clients who are transitioning into retirement, in many cases the core issue is power. For more than 30 years, I've been involved in helping couples resolve the power-struggle phase of relationships so they can arrive at what Don Montagna, former head of the Washington Ethical Society, calls "no-fault love," where each person takes responsibility for his own imperfections. At no time are harmony and no-fault love more important than in the Third Age--the term William Sadler and others use for the stage of life when the central task of achievement is replaced by the need for fulfillment.

Power problems may crop up when a husband has always earned more than his wife. In such cases, men often believe they should have the decision-making authority about the couple's spending, saving, and life goals. By contrast, women are socialized to share decision-making, no matter who makes more money.

Gender issues are only one reason for the differences in a husband's and wife's attitudes toward money. That's because of Mellan's Law, which holds that for a couple, opposites often attract--and if they're not opposite to begin with, they'll eventually become that way. I've discovered that couples may be polarized in any of seven oppositional behaviors:

Conflict No. 1: Saver vs. Spender

The market meltdown, credit crunch, and job insecurity all give Savers an edge today. However, a more frugal lifestyle will increase Spenders' need to soothe or reward themselves for the stress it causes them. As a result, Spenders in a power-struggle relationship may well feel even more judged and controlled. Instead of continuing to sacrifice for a day that may never come, they may rebel and sneak gratification now.

Conflict No. 2: Worrier vs. Avoider

The financial crisis will intensify the stress modes of these money types, a common couples polarization. Right now, many Worriers are cringing at the latest market news and losing sleep to visions of bankruptcy, while Avoiders blithely ignore the financial headlines and file their 401(k) statements unread.

Conflict No. 3: Planner vs. Dreamer

In a couple whose stored-up resentments typify the power-struggle dynamic, Dreamers will fantasize about a life where work is no longer central. They may want to travel to exotic places, sell the house and buy an RV, or start a whole new life direction. Meanwhile, their Planner spouses are trying to calculate a retirement budget, estimate portfolio yield, and chart their Social Security options.

Conflict No. 4: Money Monk vs. Money Amasser

This is one of the hardest couples' oppositions to heal. Money Monks tend to look forward to retirement as an opportunity to simplify life and give it more meaning and purpose, far away from the corrupting influence of money. Their Amasser partners, on the other hand, will be focused (possibly even obsessed) with growing their assets so they can feel more successful, powerful, happy, and secure.

Conflict No. 5: Risk Taker vs. Risk Avoider

In the Third Age, the Risk Taker (often male) may want to sell everything and buy a boat to sail around the world. The Risk Avoider, by contrast, may prefer to deepen her attachment to home, family, and friends rather than radically changing her life.

Conflict No. 6: Money Merger vs. Money Separatist

When a wife inherits money from a relative, she may want to keep some or all of it separate. If her husband has been the primary breadwinner so far and the couple has totally merged the rest of their money, his reaction is likely to be hurt and anger: "All these years when I made most of the money, you were fine sharing it. Now you finally have some money to share, and you want to keep it to yourself?" He may perceive her as selfish and unfair, and fear that she doesn't trust him or is even planning to leave him.

Conflict No. 7: Polarizing Around Different Priorities

Most people are a blend of these money styles. In addition,just about any couple will take opposite stances on individual priorities. These may be similar to the different goals I mentioned earlier. For example, he wants to go to graduate school and she would rather contribute that money to a Third World charity.

Whatever their polarization, both spouses need to become equal partners for the sake of a successful intimate relationship. Power and decision-making should be shared, no matter who is still working and who isn't, and no matter who makes or made the most money.

For an advisor, the task of guiding clients to explore their desires and priorities for their Third Age may seem daunting. However, some industry professionals have begun developing tools and processes to help couples approach this powerful life change on a more equal footing. I asked three of them to tell me how they do it.

Identifying the Differences

Michael Burnham, CEO and co-founder with two psychologists of My Next Phase, consults with advisors about "non-financial retirement planning," as he calls it. Burnham considers retirement to be among life's major transitions, ranking with marriage, childbirth, divorce and the passing of a loved one. He points out that both people enter this new phase even if only one spouse retires.

To help clients facing retirement understand their differences, Burnham has created a model with exercises to be done individually and then discussed and integrated as a couple. First, each spouse is asked, "What will change in your life? Is it a major or minor change? Is it voluntary or involuntary?" They are asked to describe everyday life in this next phase, dividing things into two categories: "My job" and "Not my job." These simple exercises can uncover differing expectations that otherwise may escalate into disappointment and conflict.

My Next Phase also includes a unique personality assessment to identify spouses' different styles in seven categories:

1. Stress: Resilients tend to minimize stressful events; Responsives tend to overreact.

2. Planning: Structureds prefer framework and closure; Flexibles prefer open-endedness and lack of structure.

3. Social: Outgoings are energized by social contact and usually have a wide network of friends; Contemplatives get energy from being alone and tend to have few close friends.

4. Activity: Independents like to be on their own; Interdependents prefer to do things with others.

5. Information: Practicals are detail-oriented; Visionaries see the big picture and ignore the details.

6. Outlook: Cautious people are more pessimistic; Optimistics have a rosy perspective.

7. Decision: Analytics are tuned to rational, linear logic; Empathetics are tuned into feelings and seek the harmony of the whole.

Burnham focuses not only on recognizing differences in these areas, but on determining how extreme a type an individual is. In each category, he also recognizes a third called "mixed" that's a combination of the two.

Once a couple's divergent styles are identified, their advisor will need to help them hear each other's feelings and desires and brainstorm what Burnham calls "new house rules." For instance, if a retiring spouse expresses a desire to chair a volunteer program that will consume great amounts of time and energy, or wants to move to a new location, the couple is encouraged to discuss these possible decisions up front. The other spouse has an opportunity to clearly communicate her feelings, such as: "Don't start that without me; I want to do it with you" or "It's fine if you do that," or "I don't want you to do that at all."

One house rule, Burnham says, is "If I'm retiring before you, I shouldn't start something that will impact you when you retire." I would modify this by saying that if one spouse wants to originate a new project or interest that will impact the other, they should take time to talk about it before any decision is made.

These decisions will obviously require a process of slow, thoughtful, empathetic communication on both sides. If you are comfortable facilitating such discussions, you can help your clients learn to "walk in each other's shoes" and foster a climate of respectful listening and good will.

Reintroducing Yourselves

At retirement, Bhaj Townsend says, we're reintroduced to the person we fell in love with so many years ago. In order to become friends and lovers again, we have to refamiliarize ourselves with this person. To facilitate the task, Townsend, founder and wealth & legacy coach with TRGi in Kirkland, Washington, developed a process called Life Focus that she has been using for 11 years.

Townsend tells clients who are in a relationship that there are actually three of them to consider--each of them individually and both of them as a couple--and all three entities are vying for attention. So, she says, "Let's invite them all to the party."

As the first step in Life Focus, each partner identifies his core strengths from an open-ended list of possibilities. In Townsend's presence, they then tell each other their life stories, organized around these core strengths. Couples typically emerge from this exercise with a deeper friendship and a better understanding of each other's motivations and yearnings.

In the second part of the process, Townsend helps clients determine their guiding principles. Each spouse is asked to choose the three values they most strongly relate to from a list that includes Happiness, Love, Integrity, Loyalty, and Responsibility. Finally, they pick their number one value and explain what it means to them. When both spouses share their lists, any entries that overlap are defined as "Us" values.

In step three, each partner creates a personal mission statement built on her core strengths and values. They then develop a mission statement for themselves as a couple. Finally they contemplate what Townsend calls "destinations" of one year, five years, 10 years, and 25 to 30 years, identifying their goals and dreams for these timelines first individually, then as a couple.

As with Michael Burnham's process, transforming the lessons learned into a strategy and carrying it out require many subsequent conversations. Townsend recommends that couples meet once a month to discuss actions taken that are aligned with their goals, listening to each other in a climate of respect, honor, and support with no criticism or negative feedback. She follows up at the end of three months and again at six months, and conducts an annual review with them at year-end. Not only does this become a way of life for her clients, but it allows her financial planning work with them to develop organically from their values, core strengths, and mission statements--the elements that matter most to them.

The Wheel of Life

To help couples entering the retirement transition phase discover what's working in their lives and what needs attention, Marty Kurtz, CEO of The Planning Center in Moline, Illinois, uses a strikingly visual process.

Kurtz, a fee-only planner with more than 25 years of experience, shows his clients a diagram of the "Wheel of Life," with nine spokes that are identified as Family, Health, Leisure, Learning, Inner Growth, Home, Community, Work, and Finances. He asks the clients to indicate how satisfied they are in each area by marking a point on the appropriate spoke, with the center of the wheel representing zero and the outer end as 10. Then they connect the points so that each client can see what their uneven circles look like.

This generally leads to a productive conversation about which areas of life need work. The spouses are asked what would have to happen to reach a satisfaction level of 10 in each area. Kurtz also helps them clarify life goals--immediate, short-term, middle term, and long-term--in each of the nine categories. They then discuss how to address these goals in order to achieve "10" with each one.

I find it especially interesting that he asks detailed questions about his clients' money memories, so he has a good understanding of the psychological burden they bring into his office. Kurtz has also developed a cash flow management approach for retirees that finds to be transformational. Like many holistically-minded advisors, he recognizes the need to lighten the emotional intensity of the past in order to help couples facing retirement negotiate their future together.

As a therapeutic educator, one of your most important missions is to help client couples prepare for the dramatic life changes of their Third Age. Encourage them to clarify their dreams and goals, understand and accept their differences, and learn to empathize with their spouse's journey enough to "cross the bridge" into the other's world.

The good news is that couples who have found a way (through introspection and life experience, counseling, or therapy) to transform and resolve the power struggle can emerge with a foundation of respect and good will for one another. As each partner learns to empathize with the other emotionally and intellectually, the Third Age can become one of their most enjoyable phases of life.


Olivia Mellan, a speaker, coach, and business consultant, is the author with Sherry Christie of The Client Connection: How Advisors Can Build Bridges That Last, available through the Investment Advisor Bookstore at invest-store.com/investmentadvisor. She also offers money psychology teleclasses for financial advisors and for the general public. E-mail Olivia at moneyharmony@cs.com.
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