Five Estate Planning Issues to Address on Retirement

New retirees are well served to pay close attention to various financial considerations, which are commonly overlooked at the time of retirement. This article reviews some of the most critical estate planning issues that you should make to address either on or before when you retire.


# 1 – The Restructuring of Assets


At the time of retirement, people have spent decades accumulating a variety of assets. One goal of retirement should be to reduce the time and care necessary to maintain what you own. This will not only reduce the costs and length of probate for your estate but will also leave your loved ones with as few challenges as possible. During the restructuring, you might also decide to limit problematic assets.


# 2 – Verifying Beneficiary Designations


Many people make the mistake of ignoring the terms of retirement accounts and life insurance policies in the decades after they are established. Because assets located in these accounts pass separately from wills and last testaments, the terms of these accounts often play a critical role. 


# 3 – Re-Evaluating Life Insurance


Maintaining a life insurance policy is often not a good idea when the underlying reason for obtaining the insurance is no longer applicable. It’s often the case that policies with a cash surrender value are more valuable as an investment rather than a locked-in life insurance policy with continuing premiums. If you’ve recently retired, now is the time to consider whether any existing life insurance policies in which you are enrolled are a good idea.


# 4 – Addressing Incapacity Issues


Incapacity begins gradually. Fortunately, by utilizing an array of estate planning tools including power of attorney, trusts, and joint accounts, it’s possible to protect your assets. While no one likes to address the possibility that they will one day end up incapacitated, making sure that you have addressed this possibility can make sure that as much of your assets as possible are preserved so you can pass them on to your loved ones. You might begin making sure that your estate is protected by having duplicate financial records sent to a child or other loved one who you plan to have performed in a guardian role. 


# 5 – Converting IRAs to Roth IRAs


With a Roth IRA, a person contributes after-tax dollars and their money grows tax-free. A person can in most cases make tax-free withdrawals from a Roth IRA after that individual has reached the age of 59 and a half. With traditional IRAs, a person contributes either pre or after-tax dollars and money grows tax-deferred. Withdrawals from traditional IRAs are taxed as current income if an individual is past the age of 59 and a half. Serious thought should be given to converting a traditional IRA to a Roth IRA. Conversion might be costly at the start, but ultimately a substantial amount can be saved on assets. 


Contact a Knowledgeable Elder Law Attorney


Achieving your estate planning goals can be complex, which is why it can prove valuable to obtain the assistance of a knowledgeable estate planning attorney. Contact Ettinger Law Firm today to schedule a free case evaluation. 

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