Ask adviser about issues using pension

My wife and I met in our early 50s, each with two children, a boy and a girl, from previous marriages.

There’ve been extreme difficulties during eight years of marriage, but we’ve survived.

We’re now retired, each working part-time to keep busy. Our primary source of income is my company pension. My wife saved her money in a registered retirement plan and we agreed to use these funds when my pension couldn’t afford vacation spending or large unexpected expenses.

After five years retired, we haven’t drawn on her resources yet.

Our children, all adults, are on their own.

The girls are doing well and have partners; the boys have both completed post-secondary school education but are having difficulty getting established in careers.

My wife recently inherited a lot of money.

She wishes to give her daughter $50,000 toward a summer cottage she and her husband plan to purchase. The money would afford a larger property.

This is to be kept a secret from her son until a later date due to his previous “adventurous” history with money.

Years earlier, my wife’s children inherited $250,000 each from their grandfather. The daughter and her husband invested their money wisely.

The son has nothing left but an old BMA and debt.

I believe this “secret” gift will eventually cause trouble.

Meanwhile, I suggested that if my wife could look after some of her own expenses, I could use some of my pension money to help my children, both in heavy debt from student loans.

She thinks that our present arrangement stays as is, meaning, “don’t touch (her) pension plan.”

It means I could never afford to help my children pay for their university education and would feel shame continuing to support my wife so she can give her funds to her kids.

We can’t agree on any of these issues. Our discussions are very heated. Torn and Confused No wonder you have trouble agreeing, since there are three deeply emotion-steeped issues:

1) Dealing with separate pensions established before your marriage;

2) An inheritance that enriches only one partner;

3) Decisions regarding the other’s children.

You can’t insist she do as you suggest, but be clear there are matters of harmony and fairness here. That warrants recommending you talk to a professional financial adviser together about the use of the pension.

Consider the financial/emotional difference to her if she used her retirement fund to pay for some of her expenses, given her sizeable inheritance.

Then consider the financial/emotional difference it’d make to you to be able to help your own children.

Your wife needs to hear this from a neutral source — though, even then, she has the right to refuse to help out.

If she would do so, I suspect your relationship would be strained even further. So I also recommend marital counselling immediately.

The relationship risks have to be presented and weighed — how her refusing to use her pension could divide you two further, and how your position of needing her financial help may make her feel taken advantage of.

Next: On keeping the daughter’s “secret” gift from her son, that’s her own risk and an argument you should drop.

She’d be wiser — and less likely to cause extreme resentment between the siblings and in her mother-son dynamic — to tell him now that a matching gift will be available if he learns to manage his money and pay off debt. But that’s up to her to decide to say. Tip of the day Income differences and their use, between a couple with previous families, can risk their marriage. Ellie chats at noon Wednesdays, at thestar.com/elliechat. Email ellie@thestar.ca. Follow @ellieadvice.