Tips for Planning a Well-Deserved Retirement

retirement planningData derived from the U.S. Census Bureau and recently reported by the Population Reference Bureau, as of mid-2014, shows that the baby boomer generation stands at 76.4 million strong.

For those born between 1946 through 1961, many are now reaching traditional retirement age and although hesitant to fully retire are still expected to have a significant effect on Social Security, Medicare and Medicaid as retirement is being redefined.

The American Association of Retired People (AARP) estimates that 79 percent of all baby boomers plan on incorporating some form of employment into their retirement plans. At the golden age of 65, many boomers are simply deciding to continue working full-time while others are opting to work part-time or change career objectives. For those choosing traditional retirement, opportunities for volunteering or participating in community service are popular.

Recently, a U.S. News & World Report article addressed this growing quandary as many Boomers are coming face to face with their planned retirement date and are hesitant to quit their careers and opt to continue to grow their retirement funds.

It is also advisable for those caught in this Catch 22 to have already began the estate planning process as well as considering these helpful tips regarding retirement while still in the final stages of gainful employment.

Estate Planning 101

Schedule a consult with an experienced estate plan attorney to discuss either devising a Trust or Will, designate a reliable and trusted Power of Attorney, establish a Living Will, and explore Estate Tax Planning as an option to “gift” to reduce final estate taxes.

Stash the Cash

Although most Boomers believe that their income does not match their retirement planning needs, it is highly advisable to revisit your strategy and contribute the maximum amount to your retirement accounts. Consider increasing the amount of your paycheck contribution deductions significantly during the time leading up to your planned retirement date. Opting to stash some cash in a Roth IRA, taxes can be paid while employed and you can enjoy tax-free withdrawals during retirement.

Take Your Retirement Budget for a Trial Run

While still employed, take your retirement budget for a test drive by abiding by your monthly projected retirement budget. By doing so, you will be able to discover if your budget is successful when put to the test. If not, there is still adequate time to prepare while still employed and changing your projected retirement date.

Bring Your Financial Picture into Focus

The best advice is to simplify. By consolidating your financial accounts and perhaps by consolidating your investment portfolio you are decreasing your risk of financial mistakes and lowering time spent on managing more than one account. Just as you will need to meet with an experienced estate planning attorney, schedule a consult with your trusted financial advisor to discuss any tax related consequences.

It is suggested that these strategies should be set into motion at least up to one year prior to your targeted retirement date, so you can ease into the next stage of your life with confidence and financial security.

If you are planning to retire within the near future and have yet to meet with a qualified Wheaton estate planning attorney, the legal team of Stock, Carlson, Flynn & McGrath, LLC offers strategic estate planning tools to simplify your total retirement plan. Contact our offices today to schedule your initial consultation.

Reviewing Estate Plans on an Annual Basis

DuPage County estate planning lawyers, estate plan updates, financial advisors, future financial plans, reviewing estate plans, estate planning documentsThe arrival of the New Year often leads people to examine their decisions and lifestyle choices, as they look back at the year gone by and reflect. Many will make choices to go on diets, begin exercise programs, or make other changes to help ensure a longer, healthier life. The New Year is also a perfect time to look back and examine any events which may have occurred and will affect one’s future financial plans.

Various life events may cause a person to make changes to any estate plans he or she has in place. Hence, financial advisors recommend reviewing these plans on an annual basis—the beginning of the New Year is a great time to review these plans.

Moreover, there are life events which typically necessitate a beneficiary change to certain estate planning documents, such as wills and trusts. These events include:

  • A birth or a death of a beneficiary: If you have another child or grandchild, you may want to redo the division of your estate to include the new child. This is also true if there is a death of a beneficiary. For example, if one of your adult children passes, you may now want to take what would have been his or her share of your estate and have that share go to their children (your grandchildren) in the event of your death.
  • Marriage or divorce: If you get married, you may want to change your estate plans to include your new spouse as a beneficiary. The same holds true if you become divorced. You may want to remove your spouse as beneficiary. These changes need to be specifically implemented to whatever estate planning documents you have. A divorce decree alone does not remove your spouse. For example, one Illinois man who had a life insurance policy of $400,000, had originally named his new spouse as the beneficiary.Eventually, the marriage broke down and the man filled out forms to change the beneficiary to his adult children. However, he failed to file the forms. When he suddenly died, his adult children found the filled out forms among his paperwork, but a court ruled that since the changes were never officially made, the wife was entitled to the $400,000.
  • Moving to a different state: Estate planning laws vary from state to state. Therefore, if you have recently moved, you should investigate what your new home state’s law are to determine if you need to make changes to your estate plans.
  • A change in financial status: Another reason to alter estate plans is if you have a change in financial status, such as receiving an inheritance or a lottery win.
  • Changes in the life of a beneficiary: If, when you had your attorney draw up estate plans, your children were minors, then you may want to makes changes since those children are now adults. Another event that may necessitate a review is the marriage of an adult child. If you are concerned what will happen to any inheritance you leave to your child because you are uncomfortable with your child’s choice of spouse, you may want to consider setting up that inheritance in a trust which has limitations.

If you would like to review your estate plans in the new year, please contact Stock, Carlson, Flynn & McGrath, LLC. Our experienced DuPage County estate planning lawyers will help ensure that your wishes are carried out with your estate when you are no longer here.

Are You Financially Prepared for a 25 Year Retirement?

25 year retirement, age of retirement, DuPage County estate planning lawyers, estate plan, retirement plan, retirement planning, retirement savings, retirement savings planRetirement and estate planning are very different now compared to past generations. Today, people live longer. The age of retirement has increased and many of us work far beyond the age of 65. In the nineties, the average age of retirement was 57 years old. Today, that number has jumped to 62. Therefore, if you do not have a solid financial retirement plan in place, you may have to continue working—at least part-time—much longer than originally anticipated.

When you do retire, chances are you will live longer than your ancestors. The average life expectancy for a man is 84 years old. Women live even longer and have an average life expectancy of 86 years. Hence, you will need enough money to live for an additional 25 to 30 years post retirement.

In the past, living expenses would actually decrease by about 20 percent when people retired. But today, healthcare costs have caused budgets of retirees to increase dramatically. A serious illness can quickly wipe out a savings account that was supposed to take care of retirement living expenses.

Also, there is no guarantee as to the kind of shape Social Security and Medicare benefits will be in by the time you are ready to retire. This is another reason why it is essential to sit down with a knowledgeable estate planning attorney to ensure that your plans are in place post death, and that your assets are in order and will provide for a secure retirement. This may also include setting up different trusts and advance directives.

It is never too early to begin your estate planning. Our experienced DuPage County estate planning lawyers at Stock, Carlson, Flynn & McGrath, LLC offer solutions to protect your rights and assets and will help you plan for a successful retirement. We can assist clients in Downers Grove, Hinsdale, Lombard, Naperville, and throughout DuPage County. Please contact our office at 630-665-2500 to schedule a consultation