You don’t need to have a massive fortune on the scale of Bill Gates or Warren Buffet to benefit your retirement while planning for the future of your estate. For Michiganders thinking about retirement, most likely the kids have grown and you are decades away from end of life issues and using a few smart estate planning strategies at retirement can not only solidify your retirement plans but also help your loved ones well into the future.
To help set expectations with your children it is important to communicate your plans as early as possible with them. Once you have that conversation with your kids you can concentrate on your retirement plan and ensuring you have what you need when you need it. Many estate planning attorneys in Michigan and elsewhere encourage clients to establish an estate plan well before retirement.
When considering payout options with pensions and annuities purchased with money from a 401(k) plan, it is important to understand some of these decisions can be irrevocable so they should be determined in conjunction with your estate plan.
Apart from retirement savings and personal wealth, all retirees need to consider estate planning tools such as health care proxies, sometimes called health care directives or living wills. These items along with powers of attorney are needed in the event a person becomes disabled and unable to deal with his or her own finances or loses the ability to communicate their wishes regarding medical care. Including these tools in your estate plan ensures your intentions are carried out from a financial as well as medical stand point by someone you trust to follow your wishes.
And for couples who have considerable assets it might be beneficial to consider a trust that can preserve your assets for your spouse or other family members if one of you should be applying for Medicaid to pay for a nursing home. And there are trusts that can be created specifically for retirement accounts so if the account holder dies, the trust will pay out according to the account holder’s wishes and not that of the beneficiary.
Source: Chicago Tribune, “Keep estate planning in your retirement mix,” Janet Kidd Stewart, June 8, 2012