Ask an Advisor: How Do You Calculate Retirement Income When Spouses’ Ages Are Far Apart?

I am eight years younger than my spouse. He retired at 61 and just took Social Security at 62. I left my full time job at the same time as his retirement, at 53, but I am still working in a part-time remote manner.

When plugging in our figures into retirement calculators, they seem to focus on the total amounts. Do I just plug in numbers based on my husband’s 401(k) accounts? Or do I add in my 401(k) accounts? I cannot access mine for several more years but I never know how to enter the information into the calculators. The same goes for entering in Social Security amounts, since I have more years to wait to add that in.

How does one calculate retirement income when spouses’ ages are spread apart? Should we calculate separately based on our own 401(k)s and Social Security? – Mia

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Retiring at a different time than your spouse, especially if a sizable age gap exists, can muddy retirement income analyses. The question of how much you can spend in retirement is already a nuanced question, and retirement calculators often aren’t designed to handle nuance.

Your situation is a great example. Most simple, online calculators project a static retirement income amount or percentage based on total household assets. This is directionally useful if partners or spouses are on the same timeline. However, that is rarely the case, and the value of these calculators can break down as a result. Different retirement dates, Social Security claiming ages or retirement account accessibility timelines introduce nuance that demands a more methodical approach to retirement income forecasting.

While this may seem a bit complex, we’ll outline a clear method while also answering your question of whether to include all assets or just your husband’s when using retirement calculators.

Start at the Household Level, But Use a Phased Approach

Retirement planning is ultimately a household exercise. After all, your lifestyle, expenses and goals are more than likely shared, so your assets and income sources should be viewed collectively as well. That means both 401(k) balances, both Social Security benefits and all other assets you have belong in your overarching plan.

However, the key nuance in your case, and in many others, is timing. Because you are eight years younger than your husband, your financial timeline is different from his. Certain assets and income streams are available now, while others are not. Rather than thinking in terms of “combined vs. separate,” I’d suggest thinking in terms of phases.

Early Phase (current age to 59½): During this current phase, your income sources are your spouse’s Social Security, any withdrawals from his retirement accounts and your part-time income. The primary constraint is access to your retirement accounts, which are off limits without incurring early withdrawal penalties.
Transition Phase (age 59 ½ to full retirement age): At 59 ½, your retirement accounts will become accessible, and decisions around when to claim Social Security come into play beginning at 62. However, your Social Security benefit increases with age, so you may decide to wait until full retirement age (FRA), which will be 67, or perhaps even later if feasible to maximize your benefits. The timing of your Social Security claim can meaningfully affect your long-term income, especially given your potentially longer retirement horizon as the younger spouse.
Later Retirement Phase (full retirement for both spouses): At this point, Social Security benefits will have become active for both spouses or will soon begin, and all retirement account assets are available for coordinated withdrawals.

A single, static calculator input likely can’t capture this evolution. As mentioned, most calculators are built for simplicity, leveraging rules of thumb to answer very high-level questions for the broad population. They are not designed for intricate scenarios that require customization and more holistic planning. As a result, relying solely on simplified, one-size-fits-all tools can lead to either overconfidence and overspending, or unnecessary conservatism and underspending.

(And if you need a more personalized plan for retirement, consider working with a fiduciary financial advisor.)

Applying Your Situation in Practice

To your specific questions: yes, you should include both your 401(k) and expected Social Security benefits, as well as your spouse’s 401(k) and his actual Social Security benefits, when calculating retirement spending. However, as alluded to previously, you should not assume all are available for immediate income. This is where many calculators can mislead. They often use a uniform withdrawal rate across all years and assets, which doesn’t reflect your real-world constraints.

As a result, if you want to use a calculator, I would suggest breaking the exercise up into phases so that you can arrive at a more realistic estimate of spending in each phase. Reframing the question from “which accounts / assets do I include?” to “how much do I expect to spend during each phase?” can help.

To do this, start by thinking through questions like:

What are your current annual expenses?
How might those change over time, factoring in travel, healthcare, housing, etc.?
Which expenses are essential vs. discretionary?

Once you define your spending and how it may change over time, you can align your income sources with those needs throughout retirement. This shifts the exercise from a static calculation to a dynamic income strategy. In the early years, you will obviously rely more heavily on your spouse’s accessible assets and Social Security. In the middle years, you can begin incorporating your retirement accounts and maybe Social Security. In the later years, you can include both Social Security streams and draw from both portfolios in a tax-efficient manner.

Practically speaking, here are some steps you could follow:

Build a household balance sheet, which should include all assets of both you and your husband.
Segment assets by availability across the three phases outlined previously.
Map income sources over each of the three phases.
Forecast spending needs across phases, ensuring each is sufficiently funded.

As you work through this process, keep in mind some common blind spots that may not be fully captured by online calculators. These might include healthcare costs (including long-term care), insurance premiums and home maintenance and upkeep, among others. Also don’t forget to adjust expenses for inflation, estimate a growth rate for your investments and account for taxes in your withdrawal patterns, if applicable, depending on the types of retirement accounts you hold.

(As you can see, a lot goes into building a comprehensive retirement plan, which is why working with an expert may be worth considering. Match with a financial advisor for free.)

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Putting It All Together

Your intuition is spot on: the reality of your situation makes using plug-and-play tools like retirement calculators tricky. When a reasonably wide age gap exists between spouses, retirement income planning becomes less about a single asset or income number and more about sequencing, timing and coordination.

While you likely want to include both of your assets and income sources when using a calculator, the more defensible approach will be to break it down in phases, accounting for different assets and income sources that become available at different times. This will provide you with a more dynamic view of income across different stages of yours and your spouse’s retirements.

However, a more personalized, holistic plan that incorporates tax optimization, estate planning, insurance and other strategies, in addition to retirement spending, can provide a clearer and more confidence-inspiring picture. This type of plan allows you to make informed decisions not just about how much you have, but also how and when to use it.

Retirement Planning Tips

If you need help building a retirement income plan, consider working with a financial advisor who specializes in retirement planning. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Even modest inflation can erode purchasing power over a 20- or 30-year retirement. Building growth into your portfolio and adjusting your withdrawal strategy over time can help maintain your standard of living. Review your spending annually and consider increasing withdrawals gradually to keep pace with rising costs while monitoring how it affects the longevity of your savings.