When establishing a financial strategy involving other stakeholders, such as paying down a mortgage, develop a written plan that all parties agree on. You can create written point-form agreements for each to sign in areas of investing, registered vehicle planning, debt repayment, etc.

When determining your goals, it is essential to think positively and avoid language such as “We will never have enough to retire,” or “We can’t seem to get ahead,” or “This debt is killing us.” Statements like this often become self-fulfilling prophecies. Instead, it is vital to design an action plan and start working towards it together with all the stakeholders, such as your spouse or partner, referred to henceforth as your fiscal partner. Write your ideas out regarding financial concerns, such as:

Reduce or eliminate debt. One of the encumbrances to investing for retirement is that you may be servicing too much hard-core credit card debt, much of which is interest. Both fiscal partners may have credit cards, doubling the family debt load and vastly reducing your net worth. Thus, it makes sense to pay down the debt on all credit cards, starting with those that carry the highest interest rates first. Aim to be 100 % debt-free of abnormal debt weighing in your net worth statement, where possible (mortgages and car payments are typically not bad debt).

You and your fiscal partner will appreciate the new clarity and increased financial freedom this gives. Slavery to debt repayment is financial bondage and will increase fiscal-related emotional stress on responsible partners.

Start or maximize your monthly investment plan. Your plan will depend on your income and expenses. If you are young, begin investing now. Any given sum of money can double frequently, depending on the passage of time and interest rate growth. At 6 % it can double every 12 years; at 4 % every 18 years. Divide 72 by the interest rate to find the number of years until the amount doubles.

This simple mathematical illustration underscores the importance of starting to invest early. If you are near retirement, you may realize you need to ramp up your investing, especially over the remaining years you have. The average Canadian retires now at age 62. Become aware of your retirement options and agree on strategies with your partner well in advance.

Reallocate assets as you near retirement. An investment portfolio still invested in close to 100 % equities near retirement is potentially risky. A portfolio must have some fixed income (government bonds, corporate bonds, safe mortgages, and real estate) to reduce stock market risk. Your partner’s risk tolerance while investing.

Take advantage of tax-saving vehicles. Registered investment vehicles can help you reduce or defer the tax hit. Some plans can offer government grants that supplement your investment contribution to help your children go to post-secondary school. Discuss the viability of tax arrangements using registered investments best suited to both fiscal partners.

Don’t sell good investments amid market losses. It may be better to stay invested and adjust your portfolio after the market begins to retrace losses, following a period of market volatility. If you hold an excellent fund, the stocks within that fund are probably okay. Nevertheless, remain aware of your investment goals, get periodic updates, and review the situation with your fiscal partner. Your financial partner may not be able to handle the stress of a volatile market, so plan accordingly.

Maintain financial accounts with transparency. Spouses and partners who share mutual financial goals have a right to be aware of their banking and investment accounts and the movement of funds through frequent, transparent discussion. Total honesty is necessary. One spouse should not borrow recklessly, nor use credit without the agreement of the other spouse, where funds are to be accounted for together in mutual fiscal arrangements. There should be only private boundaries where agreed, such as business agreements, risk, and debt and income necessary for solvency. Business accounts or contracts that increase risk should not be commingled with personal finances or accounts. Establish such boundaries in advance, or hard feelings can develop.