We discuss a situation many couples imagine will be simple but rarely unfolds that way in real life: retirement timing. Many couples picture both partners stepping away from work at the same moment and beginning the next chapter together. In healthcare households, however, careers often evolve differently. Physical demands, shift schedules, burnout, or changes in job roles can lead one partner to feel ready to retire years before the other.
Staggered retirement is not a problem that needs fixing. Instead, it is a transition that requires coordination. Because finances, insurance, and lifestyle are shared inside a household, when one partner retires it affects both people. The goal is not deciding who retires first. The goal is planning the next stage of life in a way that keeps the household stable and intentional.
One of the first concerns couples raise is lost income. Instead of focusing on replacing the retiring partner’s salary, we emphasize creating a dependable household paycheck that supports the lifestyle the couple wants to maintain. That paycheck may come from several sources working together, including the working spouse’s salary, pensions, portfolio withdrawals, or savings. By focusing on expenses first, couples can determine how income and assets work together to support their plan.
Health insurance is another common worry when one partner leaves work before reaching Medicare eligibility. We discuss several potential paths forward. The retiring spouse may join the working partner’s employer plan, temporarily continue their previous coverage through COBRA, or transition to an individual insurance policy. The key is planning these options in advance so the decision does not become stressful during the retirement transition. Insurance changes are usually a logistical challenge rather than a crisis when they are addressed early.
We also explore the financial strategy of sequencing retirement resources. Healthcare professionals often have multiple accounts such as 403(b)s, 457 plans, pensions, and other savings. Instead of drawing from everything at once, couples can structure withdrawals strategically based on tax considerations and timing. This allows some assets to continue growing while others support the household in the early years of retirement.
Finally, we discuss the lifestyle dynamics that occur when one partner suddenly has more free time while the other is still working demanding hours. Expectations around household responsibilities, hobbies, and daily routines can shift quickly. Open communication and empathy become essential. Couples benefit from discussing how responsibilities and expectations might change during this transition.
Communication is key. Amy talks about shifting priorities when her husband is sick, and Jag talks about the change in household duties with his wife returning to the office.
When couples in healthcare coordinate income, insurance, and expectations together, staggered retirement becomes far less stressful. Instead of uncertainty, it becomes a well-planned step toward the next stage of life.
(00:00) Intro
(00:38) Why Healthcare Couples Often Retire at Different Times
(02:27) Why Retirement Timing Rarely Matches for Couples
(04:18) How to Replace Income When One Partner Retires
(06:13) Health Insurance Options Before Medicare
(08:22) Sequencing Retirement Accounts and Income Sources
(10:25) Lifestyle Challenges When One Partner Stops Working
(13:42) Real-Life Example of Changing Household Roles
(16:06) Why Communication Matters During Retirement Transitions
(16:52) Coordinating Income, Insurance, and Expectations
ThimbleberryU 157 - When One Partner Retires First
Speakers: Jon Gay & Amy Walls
[Music Playing]
Jon Gay (00:08):
Welcome back to ThimbleberryU, I'm Jon Jag Gay, joined as always by Amy Walls from Thimbleberry Financial.
Hey, Amy.
Amy Walls (00:14):
Hey Jag, good to talk to you.
Jon Gay (00:15):
Always a pleasure to be with you. Today, we're talking about when one partner leaves healthcare before the other. Many healthcare couples picture retirement happening at the same time.One day you both step away from work, start the next chapter together. But in real life, rarely, is that how it unfolds.
Healthcare careers can be physically demanding, emotionally intense, as many of our listeners know, and unpredictable.It's very common for one partner to reach a point where they're ready to step away while the other one still wants to work for a few more years.
Today, we're going to talk about how to coordinate that transition thoughtfully, so income, insurance, and expectations all stay aligned. Amy, this seems like something a lot of healthcare couples have to quietly navigate, if not all couples.
[Laughter]
Amy Walls (00:58):
Yeah, it's interesting we're talking about this from a healthcare couple's perspective because it would be easy to say, well, one person's in healthcare, one's not and that's very common too. We do just have a lot of clients in healthcare, and a lot of times both parties are in healthcare or with our specialty in tech too, we get one healthcare, one tech.
That's why we're talking about it both, but a lot of what we're talking about could apply to healthcare and another industry too. So, what's interesting is that healthcare careers have a way of stretching people in different ways and at different times.
One partner may feel ready to step back because of the way shift work is happening, physical demands, burnout, while the other is still really enjoying their role or wants to continue to build financial flexibility.
What really makes that tricky, though, is that retirement decisions inside a couple are rarely individual. If one retires and then they run out of money, that affects both of them. So, when one person leaves healthcare, the household is entering a transition together. So, it's a slightly different way of thinking about it.
So, the goal here isn't just deciding who retires first, it's coordinating the next stage of life in a way that still feels stable and intentional.
Jon Gay (02:27):
That's fair. Alright, so let's start with the big picture.Many couples, as we said, just assume retirement is something you do together at the same time. You both get the proverbial gold watch together (laughs). Why does it often unfold so differently in healthcare households?
Amy Walls (02:42):
What you're really talking about is a lot of couples’ picture retirement as one shared finish line.And in healthcare, careers evolve differently for each partner over time. So, even though they're both in healthcare, one might be on call periodically or have some night shifts or just physical strain that adds up over the many years of doing this caring work.
Another role may be more administrative or academic or leadership-focused and easier to continue longer. I know for a lot of our clients who have grants, it's about their grant cycles and the projects that are coming up that they're excited about. So, basically, what I'm getting at is that timing of I'm ready to step away, if you will, just isn't identical for each person.
What matters here is recognizing that a staggered retirement isn't a problem to fix. This isn't a problem. It's simply a transition that needs coordination. And healthcare professionals that are listening, you already understand coordinated care and handoffs. This is a very similar situation.
The household, your household, is just shifting responsibilities and planning intentionally rather than reacting later.And that's what we want to get across here.
Jon Gay (04:12):
I like that, planning intentionally rather than reacting later, it’s being proactive as opposed to reactive.
Amy Walls (04:18):
Absolutely. It's the key.
Jon Gay (04:20):
When one partner leaves work, the first thing that people often worry about is that lost income. How should we approach that?
Amy Walls (04:26):
So, that's a very common way, Jag, for people to frame it. But what it assumes is that the goal is to replace income. And for many financially prepared couples, that isn't actually the issue. The real goal is making sure the lifestyle they want to live is supported in a reliable way.
So, instead of replacing income, we usually focus on creating a dependable household paycheck, the amount that covers those lifestyle needs and desires. So, that paycheck may come from several sources working together.
So, sometimes, the working spouse's salary can actually cover that. That then is easy (laughs). Other times we may need to start some pension, take some portfolio withdrawals or start using other savings along the way.And maybe we can make the paycheck work, but we need to stop some contributions for the spouse that's still working.
So, what we're looking to do is structure cash flow from assets. I think we've talked about it before that retirement income is another triangle where expenses are one corner of the triangle and they drive everything.The other two corners are income coming in already and assets.
And so, income coming in gets applied to the expenses.If there's income left over, great, we'll figure out what to do with that. If there isn't enough income, then we have to look to the assets to cover the remaining expense shortage.
Jon Gay (06:13):
Got it. So, health insurance is another concern. Of course, it's going to be common, especially if somebody leaves before they're of Medicare age.What assumptions do couples sometimes make there, Amy?
Amy Walls (06:25):
Many people assume losing employer coverage creates a major gap right away, but there are several paths forward. So, the retiring spouse may be able to join the working spouse's employer plan. And even when they work at the same place, that might be cheaper than them each having their own coverage.
Some people temporarily continue their previous coverage through COBRA. Maybe they've got a short window until they are 65 and can start Medicare. They just want to have the continuity.Others transition to an individual policy for a few years. So, really all the options might be there.
The important part of this transition is thinking ahead to what you want to do. It's no fun for anybody who goes into retirement and says or at least is heading into retirement and says, “I'm going to figure that out once I retire.” Because all of a sudden, they feel a lot of stress around, “Oh, I should have looked at this earlier.”
So, as health care professionals, our listeners understand how disruptive insurance changes feel to people. So, it's mapping that out before you leave work and the decision then becomes much, much more simple.What I think the takeaway here is, is insurance is a logistics problem, not a crisis.
Jon Gay (07:55):
So long as you're proactive and not reactive.
Amy Walls (07:57):
Exactly. And it's not a reason to not retire. I'm not old enough for Medicare, I have enough assets, I don't know how to navigate this. Not a reason to hold off if that's what your heart says to do.
Jon Gay (08:10):
Every individual circumstance is different. So, let's go back to the financial side for a minute. Once one partner leaves health care, how do you help couples think about the next phase of their financial life?
Amy Walls (08:22):
Great question, Jag. And this is where we often see another assumption. People think retirement planning is about stopping work and then living off investments (makes sense). For couples, especially when one person is still working, it's again, more coordinated. It's not my life, your life. It's we're in this flow depending on what we're each doing.
So, if one spouse is still working and earning money, they may or may not be contributing to retirement accounts. And healthcare professionals often have multiple retirement resources like 403(b)s, 457s, pensions, non-qualified savings.And all of those resources, it's a big bucket with smaller buckets inside of it.
We don't need to pull from every bucket at the same time, we can look at this and say there is a place from a tax standpoint now or a tax standpoint in the future that makes more sense for you to draw from right now so that other money can continue to grow.
Maybe some money, if we're drawing off of it does need to be a little bit more conservative than dollars we're not going to use for a long time.And so, that's staged based on when we think life is going to happen and what can be projected.
So, if salary can support the household first, then maybe it's pensions or social security, and then investments, or maybe it's salary now plus investments and social security and pensions will kick in a little bit later. And then again, later, more investments are going to fill the void.So, sequencing based on what's anticipated really helps add some security and comfort.
Jon Gay (10:25):
I've been dying to ask you this this whole time we've been talking. Obviously, the financial piece is very important. But what about the lifestyle piece? Suddenly, one partner's got a lot more time, the other might still be working those long, stressful hours.How do we navigate that?
Amy Walls (10:39):
(Laughs) Jag, are you asking me to play marriage counselor?
Jon Gay (10:41):
I know it's part of your job.
Amy Walls (10:45):
(Laughs) Yeah, at times it is. It's great that you wanted to ask that question.
You're right, it can create conflict.One partner suddenly finds they have flexibility and free time, and the other partner is still toiling at work. Long shifts, patient care, changes, et cetera. So, what we have to remember here, this is about empathy. That's what this is really about. And it can feel financial because that's the thing that they can pinpoint.
While one person is excited about these new changes in their life, the other may be finding it exhausting especially if they had different expectations. I joke with my family because I love to ski, that I will retire in a few years or soon.It won't happen; I would go crazy. I like working.
Jon Gay (11:48):
You're too much of a workaholic, yeah (laughs).
Amy Walls (11:51):
Yeah. And they joke that in three months, I'd turn them into a project. I'm like, “No, I'll become a ski instructor. It'll be great.” But really, my husband says the problem is: I would never get to pick out my own food to eat.
You would bring it to me and say, “Here's your lunch, here's your snacks.” And he's like, and when I want junk food or something bad for me, I'm never going to get it because you're not going to let it in the house.
[Laughter]
Jon Gay (12:15):
That's great.
Amy Walls (12:17):
And so, he has this expectation — there's also an expectation that I will paint within three months every room in our house six times (not going to happen).But the point here is I have this one vision of what life would be like if this happened, my husband has a very different vision that my kids jump on board with.
And so, we joke about it as an open conversation.That's what couples entering this phase, where one person has a new life that both people have probably looked forward to at some point, need to talk about. Hopefully, they can do it in a joking and laughing way, but it's important to get those ideas out.
I'm still going to be working.And if we share household duties 50/50, but you're home now, is that still the case? Or I was thinking you'd pick up most of that, but now I'm still doing it. Or you took on all these hobbies that actually have taken up more of your time than working did.I'm picking up, even though I'm still working, more of the responsibilities now. That's where that conflict comes from.So, I'm so glad you asked about this.
Jon Gay (13:42):
If I can make a confession here, Amy, part of the reason I was dying to ask this question is it relates to me a little bit. So, obviously my wife and I are not of retirement age, but we moved into this new home over the holidays that we love. And about a month ago, she was mandated back into the office five days a week.She'd been working from home, mostly, since COVID. I work from home.
So, we've got this new house that she can really only enjoy on Saturdays and Sundays, and I'm here all day with the dog.And I have tried, to your point a moment ago, to pick up a lot more of the housework stuff, the dishes, the laundry. Not really cleaning because I'm not good at it, and she'll just do it over anyway.
(Amy's cracking up if you're on the audio version.) But this relates to me because the dynamic is something that she and I have had to navigate because I'm home, so I'm taking on different responsibilities.
Obviously, I'm working full time as well, but I'm taking on different responsibilities because she's leaving the house at 7:15 AM and not getting home until 6 at night. So, that means I've got to … and she hasn't quite trusted me in the kitchen yet either so that's the meal prep is a whole another podcast (laughs).
But it is something that we have to navigate so I can absolutely see how this would be the case when a couple is at retirement age and one person is no longer going to the office or working and the other person is still, especially in a physically demanding job, doing it.
Amy Walls (15:00):
I'm so glad you brought that up. I think the key is remembering that this is a temporary transition but recognizing what temporary means.
My husband and I had a conversation a week or so ago about when he's sick. When he's sick, he tries to stay active in the family, and I was sharing with him that we wish he would just go take care of himself.He just tries to power through and he's not having fun and we're then trying to balance, like we want to do things, but what is he capable of doing in a way where we're not going to make him miserable? And I'd rather he just goes off and I need to handle cleaning, I need to handle meal prep, I need to handle these things instead of it being this weird mix.
But when it's an illness, that's a short timeframe, typically. We're talking about job transitions. These transitions are going to be probably several months.
Jon Gay (16:06):
Or years.
Amy Walls (16:07):
Yep, they could be years. So, by being thoughtful about how long do we anticipate this being? It's, I think, easier to say, “Oh, we should talk about this because otherwise …” and this is what ties it back to financial planning and a financial podcast, where a lot of people go is, “But I'm making the money, therefore, I shouldn't have to, and now I'm resentful.” And I know that's not what any of our listeners, where they want to be or what they want to do.
Jon Gay (16:39):
Or our spouses for that matter.
Amy Walls (16:40):
Exactly.
Jon Gay (16:41):
So, to kind of put a bow on this, Amy, when one partner retires first, the goal isn't solving a single financial problem, it's coordinating several transitions at the same time and not just the financial ones.
Amy Walls (16:52):
Exactly, Jag. When couples think through income, insurance, and expectations together, the transition becomes much smoother. What that means is instead of feeling uncertain, it starts to feel like a well-coordinated plan, and that allows both partners to move in the same direction, which is this next stage of life, with confidence, and I think by practicing that, it also makes the next stage a little bit easier too.
Jon Gay (17:24):
This is episode 157 of our podcast, and like so many other episodes, this has come down to communications and planning.
Amy Walls (17:32):
Absolutely.
Jon Gay (17:34):
Alright, Amy, if one of our listeners or viewers (since we're on YouTube now as well and video form) wants to reach you and your team at Thimbleberry Financial, how do they best do that?
Amy Walls (17:42):
Yeah, they can find us online at thimbleberryfinancial.com or give us a call at (503)-610-6510.
Jon Gay (17:52):
Alright, I'm going to go do some dishes and we'll talk soon.
Amy Walls (17:55):
(Laughs) Sounds good, Jag.
[Music Playing]
Voiceover (17:56):
Securities offered through registered representatives of Cambridge Investment Research, Inc., a broker-dealer, member of FINRA/SIPC. Advisory services through Cambridge Investment Research Advisors, Inc., a registered investment advisor. Cambridge and Thimbleberry Financial are not affiliated.
Discussions in this show should not be construed as specific recommendations or investment advice. Always consult with your investment professional before making important investment decisions.
Securities offered through registered representatives of Cambridge Investment Research Inc., a broker-dealer, member of FINRA/SIPC. Advisory services through Cambridge Investment Research Advisors, Inc., a registered investment advisor. Cambridge and Thimbleberry Financial are not affiliated.