By Nancy J. Brady, RN, Esq.- Partner, Brady & Marshak, LLP Attorneys at Law
Despite the fact that we are well into the 21st Century, and women have made significant advances socially and economically, women’s planning for major life events and retirement has not generally kept up with those advances.
Well established statistics show that most women outlive their spouses (80%). Additionally, women often play a caretaker role for elderly parents, as well as for their grandchildren (“sandwich generation”). Further complicating things, divorce or widowhood may result in second and sometimes third marriages with children from prior marriages to be considered in estate planning.
Many women rely on the men in their lives to support them, and make financial and planning decisions. It is important for women to become knowledgeable and aware of their specific retirement and estate planning needs. Planning for the various stages and roles in a woman’s life will, naturally, be different for every woman depending upon her particular circumstances. As outlined below, there is basic planning that every woman needs to have in place at any age, as well as specific more advanced planning for different circumstances.
Twenties and Thirties: The basic estate planning documents need to be in place, they include a Health Care Proxy, a Power of Attorney and a Last Will and Testament. If total assets are in excess of several million dollars, estate planning will involve planning to minimize estate taxes for your beneficiaries. If you are a parent, even if your estate is not quite that large, you should have provisions in your Last Will and Testament for your children- to include specific ages at which you would like them to inherit (by law minors cannot inherit outright until age 18; clauses in your Will can provide for portions at specific ages with balance to be managed by a trustee), as well as your choice for guardian (to manage the day to day lives) for the children. Aside from legal planning, financial planning for college for the children and retirement planning should be in place.
Forties and Fifties: Review estate planning documents whenever there is a change in your life circumstances (example: marriage/divorce/widowhood/inheritance). Make sure your elderly parents have their basic estate planning documents in place so that you may act on their behalf without delay if they become ill or otherwise need assistance. Consider purchasing your own long term care insurance from a reputable broker who will structure a policy based on your individual (income and assets) needs. If your estate has grown significantly make sure your legal documents are structured to maximize estate tax savings for your family. Continually review your progress (with your financial advisor) towards securing your retirement needs, and your progress towards those goals. The meetings with your financial advisor should include deciding when to begin collecting Social Security benefits.
Sixties, Seventies, Eighties and Beyond: If you have not already done so, make sure to have basic estate planning documents in place (Health Care Proxy, Power of Attorney, Last Will and Testament). Update and make changes (with the assistance of your attorney) to any documents particularly if circumstances have changed since you completed the documents. Establish and implement a plan (with your attorney) to finance long term care (home care, nursing home care, assisted living) whether you have a long term care policy in place or not.
Estate planning is more complicated now than it was for our ancestors- planning with various types of trusts can provide solutions to many of the issues presented when planning to pass our legacy on to future generations.
This article is for general information, and is not intended to provide specific legal advice. If you would like to speak to one of the attorneys at Brady & Marshak, LLP, please call 1-718-738-8500.