06/21/2025
Did you know that stay at home parents can save for retirement IN THEIR OWN NAME via a Spousal IRA?
A Spousal IRA is a Roth IRA or a Traditional IRA, opened exactly the same way. The only difference is that you don’t have to have earned income in order to fund it!
(You do need to be *married, filing taxes jointly* to someone who has earned income. But other than that? The account is exactly the same)
The money you deposit and invest in that account can come from anywhere - the actual dollars added don’t have to be from the “earned income” of your spouse, though they can.
Gifts? Savings? Money from babysitting another family’s kids? All works just fine. Under 50, the max is $7,000 a year. After that? You can contribute an additional $1,000.
The best part about a Roth IRA? You can withdraw your CONTRIBUTIONS at any time without paying taxes or penalties (before 59 1/2, you can’t withdraw EARNINGS without penalty)
Which also means it can double as a backup emergency fund in your own name ONLY and not jointly with your spouse.
Considering the number of horror stories of drained bank accounts before he files for divorce…. I’d call this no small deal.
Reminder: you have to then INVEST that money you’ve contributed to a Spousal IRA. For retirement sized growth, you need it to grow, which means it needs a bigger boost than a cash savings can do.
Note: if you’re using a Spousal (Roth) IRA as a backup emergency fund, perhaps some of that is kept in a money market (cash account) for easy access. The rest? You want that compound interest to do its magic.
Ps. If he takes issue with you having a retirement account *in your own name* and not his, that’s a big ol’ red flag 🚩
If you are truly partners, then there should be zero issue with you having some of the retirement $$ in your name.
Order of operations for retirement savings, in my personal opinion? 401k contributions to get the full company match, if there is one. Next after that? Should be the Spousal IRA, honestly.
And then if you can max that out? Time to go back to the 401(k).
(Disclaimer: not official investing advice, just my 2¢)
My priority is ALWAYS to make sure the stay at home spouse is taken care of as best as possible.
In the event of divorce (or death or permanent disability of the working partner), they are going to be at a disadvantage. Even if savings are split 50/50, longterm income is not. One more place where equal = / = equitable.
Feminism looks like supporting and celebrating women who want to stay home. But it ALSO looks like making sure that decision doesn’t mean being permanently reliant on a man.
And yes, I picked trad gender roles here for this thread - because MOST situations like this look like a hetero couple where the wife stays home. But that doesn’t mean all - so make sure to protect yourself and your partner in whichever way your personal life looks. ♥️
📷: photo of my little dude when I was on maternity leave and home with him way back in the day 🥰
