It is important to have a conversation with your grown children about the money they will inherit, in order to ensure that you have given them the best chance to make this wealth last. Unfortunately, plenty of assets that have passed on to future generations do not last for long and this is particularly true when it comes to family business interests. The family business interests or the wealth amassed by the company could be misspent or squandered away in just one generation if you’re not careful. The best way to guard against this is to ensure that you have taken a comprehensive approach to estate planning and engaged your beneficiaries in a conversation about how to protect this wealth. Having the right support from an experienced estate planning professional who understands how all of these issues will affect your own future is beneficial. Unfortunately, trusts and investments often do not last until the third generation.
Thousands of business owners and high net worth families will even have difficulty passing on this wealth to the children, much less the grandchildren. Many of these cases involve a breakdown in communication and trust. Lack of preparedness on the part of the younger generation receiving the wealth is part of the challenge but it is also the responsibility of the person making the estate plans to consider all possible ways that they could guard beneficiaries from themselves.
Beneficiaries may not be capable of receiving a large lump sum inheritance. An estate planning professional will be well advised to counsel you about the unique situations in your family, especially if you are concerned about a spendthrift child or a child who is struggling with addiction-related issues.
If you can’t afford long-term care, you should be prepared to qualify for Medicaid as quickly as possible. But this kind of advanced planning is often overlooked and could be catastrophic depending on your individual situation.
The cost of long term care has many different implications for those approaching retirement age. People who have spent their entire life saving for their retirement and hoping to tap into pension funds and government benefits can be shocked to realize the rising and significantly expensive costs of long term care.
For these individuals, the support of an experienced estate planning attorney is necessary. An estate planning attorney should also have plenty of background working in the area of elder law, such as advising you about advanced Medicaid planning tools you can use.
More senior citizens are filing for bankruptcy with the rising costs of long term care being one of the leading factors. Since 1991 the rate at which seniors have filed for bankruptcy has more than doubled, and the percentage of elders in the bankruptcy system overall has almost quintupled.
This data was pulled from research completed by the consumer bankruptcy project, indicating that seniors show they are struggling with the unmanageable costs of health care and inadequate income to help afford a lifestyle in retirement and pay for their health care concerns.
More seniors are less likely to pay their own bills, meaning that they will have to turn to Medicaid and plan appropriately with the help of a knowledgeable estate planning and elder law planning attorney. A decrease in retirement benefits across the country is one of the leading reasons why elderly bankruptcy is rising, as fewer people have access to pension funds and reliable sources of income and support in their retirement years.
Just one health care event as an individual or as a spouse in a married couple could be catastrophic to the family finances and can present significant estate planning challenges. Scheduling a consultation with a knowledgeable lawyer today is extremely beneficial for your future. You need to know what to look for in terms of advanced long-term care planning and other elder law issues- our lawyers are here to help.
A study recently completed by RBC Wealth Management indicated that there has been a major change in the attitude about wealth shared between millennials and the baby boomer generation.
Approximately half of boomer women who participated in the study said that they took the lead on financial planning, whereas up to 72% of millennial women were responsible for this area of their households. This trend was consistent across charitable giving, will planning and day to day banking.
The wealthier the household, the higher the chances were that a woman was leading the financial planning and was actively involved in the legacy and estate planning. For those households that had greater than $5 million in investable assets, women were the primary decision maker. Key differences also recorded in the study between the two generations were shifts away from thinking about money as a method of providing security, and instead towards the opportunity to do more for the world.
Approximately 41% of boomer women said they intended to pass on their wealth to their children, whereas only 15% of millennial women responded the same. A total of 65% of women classified as millennials felt that it was their responsibility to use their wealth to benefit society at large compared with only 52% of women in the boomer category. Women who are wealthy as millennials are much more likely to have developed their wealth on their own when compared with boomer women.
Both planning for your future in terms of retirement as well as discussing how you’ll protect your assets and send them into the next generation are worthwhile topics to discuss with a lawyer. Your attorney can guide you through the process of figuring out where you’re at in life and how that translates to your estate planning and retirement planning process. Taking a long look at the issues involved helps you to prepare for your next steps. Regardless of your age, you’ll be more successful if you set up a conversation now with a lawyer who can help you answer questions and create a plan.
If you have recently found yourself in the position of needing the services provided by an experienced estate planning attorney, now is the time to schedule a consultation to talk about leaving behind a legacy, asset protection and other important issues connected to estate planning.
A recent study completed by Wells Fargo found that one out of every six older Americans knew that their financial documents are out of date. Many individuals put off these tasks because they assume a lack of urgency and that it is not important to deal with right away.
However, any time that you get prompts from a technology platform, an estate planning attorney or a financial advisor showing that your accounts may need to be updated, this is a good opportunity to review and verify that all of your beneficiary information and other planning tools are in line what you intend to accomplish. Furthermore, if you’ve done your estate planning but haven’t explained your goals and intentions to your family, this is another way that you can be exposed to problems. Not talking about your money will avoid you making a plan for what would happen if you were to become unable to handle your financial affairs.
This is particularly problematic in the event that you develop dementia or another cognitive problem later on. You want to have these wishes articulated clearly and communicated to key stakeholders so that you can avoid the possibility of problems in the future.
Make sure that you talk over what you want your plan to include with your lawyer and then make a strategy for informing loved ones.
There are four critical things you can do to avoid financial procrastination, which can endanger your own future and that of your beneficiaries as well.
According to research, Americans pay a price for procrastinating on their financial concerns, but many put these issues off anyways. There are missed financial opportunities abound, whether it’s failing to put together a will, not having enough money in the emergency fund or getting a late start on retirement planning.
Many people know that they ultimately need to take action and plan on doing something someday, and Americans can delay for a broad number of different types of reasons, including the effort involved, the amount of knowledge required just to make these critical decisions, or the fact that many people feel paralyzed about the possibility of making mistakes.
Many people also underestimate the importance of future consequences when making decisions and people prefer to spend now rather than save for the future.
Procrastination has also been tied to inertia which keeps people in a cycle of doing what they’ve always done. Four critical mistakes can affect your financial future most significantly and these include:
· Paying only the minimum on your credit card
· Not having an emergency savings fund
· Ignoring estate planning basics and opportunities to put together documents to protect you while you’re alive and after you pass away
· Failing to get serious about retirement opportunities
All of these issues can easily be avoided by networking with experienced professionals in the field who can give you a better sense of what is involved in protecting your future and how to avoid many of the most common mistakes.
Far too many families avoid talking about the process of estate planning and many people don’t even have a basic will. Problems may emerge when people are suddenly thrust into a position of managing someone’s care or organization of documents after an incapacitating event or death. Far too many people don’t realize that they are anticipated to be the primary caregiver for their aging parents.
Taking care of parents in old age can be an unexpected surprise that interrupts your savings. A recent study completed by Bay Alarm Medical showed that 55% of parents anticipate that their children will be the ones caring for them. This could lead parents to avoid taking on critical planning opportunities such as purchasing long term care insurance, relying on children instead.
But an adult child who does not know that he or she is going to be asked to step into this role will have significant disruptions in their life. These parents anticipate that their adult children will take care of them financially and physically. In certain areas of the United States, adult children were less likely to realize that they were the ones responsible to step in in this role.
For example, in the Midwest, only 36% of adult children anticipated that they would be the ones caring for their aging parents. Sitting down and talking through these difficult topics with your loved ones can make it much easier to navigate problematic situations as they emerge.
An estate planning lawyer can help you accomplish your own estate planning and see what options are available for helping your aging parents.
One recent study found that $36 billion may be a low estimate for the final total on elder fraud. Unfortunately, scams targeting the elderly have been on the rise in recent years, be it attempting to get their private information to open credit cards in their name, or to encourage them to list strangers or relatively recent acquaintances in their estate planning documents.
Many people are aware of some of the most popular elder fraud scams, but criminals are getting better at hiding their work under the guise of seemingly legitimate plans.
One 2015 report, targeted $36.5 billion as the amount of money lost in financial abuse and scams, however, that problem is growing and three out of ten state securities regulators report that they have seen an increase of complaints and cases involving senior financial fraud and exploitation.
Only 3% of regulators reported a decline. Thieves are often following the money and the most common types of abuse include exploitation, account distribution, power of attorney, trustee or family member taking advantage, diminished capacity, fraud and excessive withdrawals.
Declining condition is not the only issue that affects these severe problems. This in fact has only been associated with 33% increase in scam susceptibility. Many of the victims of financial elder fraud today are not disabled or demented at all. One out of every 18 cognitively intact older people is subject to abuse fraud or financial scams, according to an American Journal of Public Health study. To protect your assets and ensure you have appropriate documents that protect you and your loved ones for many years to come, schedule a consultation with an experienced estate planning lawyer.
Parents may have numerous challenges as they shift into senior citizen years. However, a new study by the Center for Retirement Research at Boston College, determined that children can be a detriment to saving enough for retirement. Children are expensive because they require clothing, food, child care, and education.
The overall family income can be negatively affected by one parent, in particular, taking a lesser job or staying at home. This means less of a chance that that parent will be able to set aside money for retirement. Within a family, every child is associated with up to 4% less wealth. If the parents are in their 50s, each child increases by 2 percentage points the parent’s risk for not having enough support financially to get through retirement.
It’s estimated that nationally approximately 50% of couples do not have enough assets like a pension payment, retirement plans, or a house that is completely paid to sustain them through a full retirement, which could last as many as 30 years given recent longevity numbers. With this information, you need to be prepared to protect yourself and consider all of your financial obligation as you near retirement.
Retirement and estate planning are well worth the time and effort put in to ensure you’ve got something that reflects your needs and goals. Engage the services of professionals to get peace of mind with your planning.
While general financial and estate planning advice is intended to apply to all investors, the truth is that women statistically live longer than men and may face unique issues such as ensuring that the assets they have set aside will continue to last them throughout their expected lifetime. This also confronts the challenges faced by many women given that they are likely to earn less over the course of their careers compared with male counterparts due to the gender pay gap and taking time off work to be caregivers.
Although the gender pay gap is decreasing, women still earn 83% of what men are in 2015, according to research collected by the Bureau of Labor Statistics. This often leads to women saving less for retirement, receiving smaller pensions, and getting less in social security benefits.
Women are more likely to live on their own in their golden years due to their own choices, or divorce or death of a spouse. It is crucial that they take individual responsibility and planning opportunities as seriously as possible because their financial decisions may have repercussions that influence them for many years to come.
Scheduling a consultation with a dedicated Massachusetts estate planning attorney can help give you a broader perspective over the issues involved in financial and estate planning and the necessary documents that may be required to assist women to provide for their own care and lifestyle over the course of retirement.
Debt is a problem for people of all ages, however, a new research from the University of Michigan Retirement Research Center indicates that debt is a particular problem for baby boomers. The study has been conducted every year since 1990 and looks at the experiences of more than 20,000 Americans over age 50. Magnified Money identified that 33% of Americans over the age of 50 currently carry non-mortgage debt from one month to another.
The average amount of non-mortgage debt was almost $12,500 and approximately $4,800 in credit card debt. Any type of high interest debt can make it problematic for an older American to have a quality lifestyle in retirement. This is particularly true if they are exposed to any costs associated with long term care.
The rising costs of health care needs as people age is extremely important to consider, particularly for a couple that may have counted on the joint retirement to fund their retirement needs. Their assets can become quickly decimated by the health care costs linked to just one long term care event, such as the diagnosis of Alzheimer’s or a broken hip.
These issues can jeopardize the retirement of the other spouse as well and require careful and complex planning. If you are concerned about how to protect what you’ve accumulated over the course of your life, estate planning is a must. Consulting with an experienced lawyer sooner rather than later is strongly recommended if you have estate planning questions.