Beginning your retirement is a significant milestone that is worth celebrating. You have put in many years of hard work and can now focus your energy on the next phase of your life. However, before you begin this next chapter, you must ensure that you have thoroughly thought through this exciting change in your life. […]
Beginning your retirement is a significant milestone that is worth celebrating. You have put in many years of hard work and can now focus your energy on the next phase of your life. However, before you begin this next chapter, you must ensure that you have thoroughly thought through this exciting change in your life. When beginning your retirement, there are some things to consider to ensure that you protect, grow, and transfer your assets court and conflict-free.
A properly executed and legally binding estate plan is a significant first step toward ensuring that you and your loved ones are cared for. However, estate planning is not a one-and-done event. You must review your plan every year or so, especially after significant life events such as the beginning of your retirement. When considering your existing plan, ask yourself the following key questions:
Do you still own the same property or account balances as when you created your plan? What will the balances be like at your death? Chances are, you put money into investment or retirement accounts during your working years to prepare for this next chapter. While you may have a lot today, you must know that this value may decrease once you start withdrawing from those accounts.
Does your plan assume that your children or other young beneficiaries are still minors? A birth usually prompts parents to have an estate plan created. However, once drafted, many parents continue living their lives without giving much thought to their estate plans. If it has been some time since you created your estate plan, your then-minor children are likely now adults or approaching adulthood. Your focus may no longer be on choosing the most suitable guardians but on ensuring that you appropriately address your adult children’s needs in your documents.
Does your plan rely on proceeds from an employer-provided life insurance policy? As part of an employment package, many employers offer life insurance. However, this policy may no longer exist once you are no longer working. You must explore other options if you relied on these proceeds to provide for your loved ones at death.
Do you want to change how much your beneficiaries inherit and how they receive their inheritance? One of the things to consider when beginning your retirement is that now that some time has passed, are the amounts and ways the money and property are being given still appropriate or possible? For example, imagine that your will or trust provided that $300,000 be held in a trust for your only child’s benefit and then distributed to them when they turned thirty-five. Is it likely that you will have less than $300,000 at your death, and what wishes will have to be sacrificed as a result? Also, if your child is now thirty-five or older, any money and property would be given to them automatically based on the provisions in your documents. Are you still okay with that? Now that your child is older and you understand their needs and abilities better, you may want to consider changing how they receive the money and property. They may require more than you had initially planned, or perhaps they are successful enough to be okay without your inheritance.
If You Do Not Have an Estate Plan or Have Not Completed It
Do not procrastinate any longer. The only way to truly protect yourself and your loved ones is to have an intentional and legally enforceable estate plan. To begin thinking about your estate plan, you need to evaluate your new lifestyle and answer questions such as the following:
What accounts and property do you own? To ensure that we craft a comprehensive plan, we all need to be on the same page about what you own and the value of your money and property. From there, we can help you determine what will happen to this money and property if you cannot care for yourself and at your death.
What are the current needs of your loved ones? Based on your unique situation, you should determine the needs of your loved ones and whether you can support their needs during your lifetime (if necessary) and at your death.
Can you accomplish your goals with what you have? Working with an experienced professional, you can consider the answers to the first two questions and determine how likely you will be able to carry out all of your wishes. Together, we can examine all options and develop the best solution for you and your loved ones.
We are excited to help you celebrate this new chapter in your life. Part of this celebration should include visiting your financial and estate planning team to ensure the celebration can continue for many years. Please book a call if you want to discuss your existing estate plan or create your first one.