Retirement marks the beginning of a new chapter – a time to enjoy life at your own pace. If retirement is on the horizon for you, now is a good time to look at your estate plan to ensure that it aligns with your plans for the future. Here are five essential estate planning tips for those nearing retirement:
- Update Your Estate Plan to Reflect Current Goals
As you transition into retirement, your priorities and goals may have shifted. Review your estate plan to ensure it still aligns with your current circumstances.
- Have your children grown up and become financially independent?
- Do you have new grandchildren you’d like to include?
- Has your marital status changed?
Life events like these may require updates to your will, trust, or other estate planning documents.
- Establish or Review Your Healthcare Directives
Healthcare becomes a more prominent concern as we age. Make sure you have:
- A health care proxy to designate someone to make medical decisions on your behalf if you are unable to do so
- A living will to specify your wishes for end-of-life care
Having these documents in place ensures that your preferences are honored and reduces stress on your family during difficult times.
- Evaluate Long-Term Care Options
Long-term care can be one of the most significant expenses in retirement. Consider strategies to plan for these costs, such as:
- Purchasing long-term care insurance
- Setting up an irrevocable trust to protect your assets while ensuring Medicaid eligibility if needed
An estate planning attorney can help you navigate these options and create a plan that suits your needs.
- Consolidate and Organize Your Financial Accounts
Retirement often means drawing income from multiple sources, such as pensions, Social Security, and retirement accounts. To simplify things for yourself and your beneficiaries:
- Consolidate accounts where possible
- Ensure that all accounts have up-to-date beneficiary designations
- Provide your executor or trustee with a clear list of accounts and login credentials for any digital assets or financial management platforms
- Consider the Tax Implications of Your Estate Plan
Taxes can take a significant bite out of your estate if not properly planned for. As you approach retirement, consider:
- Setting up a trust to minimize estate taxes
- Exploring Roth IRA conversions to reduce the tax burden on your beneficiaries
- Gifting strategies to pass on wealth while reducing the size of your taxable estate
An experienced estate planning attorney or financial advisor can help you understand your options and create a tax-efficient plan.
If you’re ready to take the next step in planning your estate, reach out Roth Elder Law to discuss your goals and create a comprehensive plan tailored to your needs. Call us at 607-962-6162 or complete our intake form, and we’ll schedule a time that is convenient for you.