The Denver Investor Pulse Poll

Morgan Stanley recently released findings from the “Morgan Stanley Investor Pulse Poll” of 1,008 U.S. high net worth (HNW) investors age 25 to 75 with $100,000 or more in investable household financial assets.

In this article, we examine findings from the survey with respect to financial roles and responsibilities among couples.

Most Couples Have Balanced Approach to Investment Decision-making

When faced with making investment decisions for their household/family, about two-thirds of married/partnered affluent Denver investors (68 percent) report that both members of the relationship share in the decision. Considerably fewer, 24 percent, say the male in the relationship takes charge of investment decisions while fewer than one in 10 married/partnered affluent investors report that either the female leads the discussions or that the decisions are made separately.

Indeed, our practice makes a point of meeting with and involving each person who shares an interest in the financial outcomes of the estate, which can be a critical component to managing investment results over time – it helps to build consensus so that knee-jerk reactions are not taken by any one individual.

Financial Professionals Recognize Couples’ Partnership in Financial Decisions

When asked with whom their financial professional discusses investment issues, 83 percent of coupled affluent investors using a professional say their advisor talks with both parties. The vast majority of these conversations happen when both spouses/partners meet together with the advisor (78 percent), as opposed to an advisor having discussions with each person separately (5 percent).

This demonstrates the united stance that couples tend to take when it comes to key conversations related to investments. By comparison, 16 percent report that their primary advisor speaks solely with one member of the couple. But in our experience, while this is true for the overall strategic direction the family is taking, on a day-to-day basis it is helpful to soft-designate a lead spokesman for the relationship. It reduces overall frustration with responsiveness issues and minimizes lack of coordination.  

The same pattern – shared discussions and shared decision-making – is seen across a number of financial and non-financial topics related to retirement. More than seven in ten partnered Denver-area affluent investors report that both sides of the relationship are equally likely to start conversions about preserving their wealth for their heirs, and a nearly equal proportion are equally likely to lead the discussion on having enough money to continue a certain lifestyle in retirement and how to fund their retirement. In fact, the majority of all married and cohabitating investors say both partners lead discussions for all eleven topics related to retirement.

Men – either themselves or on behalf of their spouse – more often take the lead on how to fund retirement.  At the same time, women – either themselves or on behalf of their spouse – more often take the lead in discussions about their own health and also about their spouse/partner’s health. Joint discussions about planning for an unexpected serious illness increase by age, from 68 percent among those age 25-54 and 69 percent of those 55-64 to 84 percent among those age 65 or older. Pragmatically speaking, those of our clients who early on have had these difficult discussions about preparing for third-party care and serious illness are the ones better able to manage their finances against the plan we design.

Among married/partnered self-only led discussion households, men are significantly more likely to say they start talks about the tactical methods for achieving retirement goals, including making “catch-up” contributions needed to fund a 401(K), estimating retirement longevity and determining the best timing for taking Social Security.

In other words, if you don’t have someone in the family who is the natural “engineer” and initiating the important questions, at least have the discussion about what you think your financial life may be missing. In either case, it takes the skill of an advisor to help prioritize and educate you on those issues and then smartly implement the tactics around them.