The last of the children have moved away from home. You’re officially an empty nester! If you’re like many parents, adjusting to this new found freedom and income will take some time. Here are some great tips to keep in mind as you plan for your future:
1. Schedule an appointment with a reputable financial planner or accountant to review your retirement plan and make any necessary adjustments to your savings and investment plan to accommodate the lifestyle you want to have in your post-retirement age. For example, you may want to lower your household budget because you no longer have expenses related to raising children, but possibly increase your personal spending because you would like to travel.
2. Examine your estate planning documents, old will and powers of attorney and make sure they still reflect what you want to happen if you can’t act on your own behalf. A few things you should consider: (a) Do any of your children have legal or marital concerns that might put their inheritance at risk? (b) Are any of your beneficiaries receiving government benefits, whose eligibility might be jeopardized by an inheritance from you? (c) Do you still want the same people acting as your health care or business powers of attorney? (d) If you plan to become a “snowbird” and travel out of state for extended stays, do you know if your current estate planning documents will be honored in your secondary state of residence? (e) Has your net worth increased significantly since you signed your will or trust? (f) Do you still want the same people named in your original will or trust as beneficiaries? (g) Have any deaths or births occurred within the family that would require an amendment to your will or trust? (h) Have you acquired any titled assets since you did your original estate plan (real estate, minerals, investments, vehicles, business interests, etc.)?
If you answered yes to any of these questions, we strongly urge you to visit an experienced estate planning attorney to review and possibly update your estate planning documents. As you are reviewing these original documents, do not write on the original documents, lest you accidentally invalidate them. Make a photocopy of the documents on which to jot your notes, or place sticky notes next to the areas where you have concerns.
While you’re at it, make sure your children know where you keep these documents should they need to access them in an emergency. If you are uncomfortable giving your children access to these documents at this time, you could always ask your attorney to keep the original documents for safekeeping. Then, you can direct your children to contact your attorney in the event of your death or incapacity.
3. Are you concerned about rising nursing home costs and how you will pay for them if you or your spouse need full-time care? If so, you need to make an appointment with an attorney experienced in long-term care planning and Medicaid planning.
4. This is a good time to do an overall review of your life insurance. Do you still pay on a disability policy that you no longer need? Could you be over-insured now that all of the children are adults and living independently? Have you checked the beneficiaries named on those policies lately? It is important to review the named beneficiaries periodically. We’ve seen many scenarios where a married couple thinks they have named each other as beneficiaries, but upon the death of a spouse, it is discovered that a sibling, long-deceased parent, or even an ex-spouse was named instead.
5. If you are eligible and have not already done so, enroll in the Medicare system and begin taking advantage of reduced health care fees. If you are confused whether you have the correct benefit plan, you can contact your local Area Agency on Aging for advice on this matter. Many pharmacies also offer counseling for senior citizens regarding selection of Medicare supplemental plans.
6. You also may be eligible for senior discounts at many restaurants, sporting events, travel companies, and on insurance policies, etc. You should always ask if the company you want to do business with offers a discount.
7. Don’t jump into a home remodel project now that you have more cash until you’ve done a reevaluation of your home value. If your plan is to downsize in five years, a remodel may not make financial sense in light of what it would do to the projected value of your home.
These are just a few of the topics that new empty nesters should discuss as they enter this next phase of life. If you find yourself with questions on estate planning, long-term care planning or Medicaid planning, please contact Davis & McCann, P. A., Dodge City, KS. We are members of Wealth Counsel, a national consortium of Estate Planning Attorneys and the National Academy of Elder Law Attorneys (NAELA). We focus our practice on providing clients with the best legal advice on estate planning, Medicaid and long-term care planning, business formation, family business/small business succession planning, probate, trust administration, real estate, and related matters.
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