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Are you Retiring this Year? Add These to Your 2018 Planning Checklist
These three big factors are often overlooked by many people as they plan their retirement. They are highlighted in a recent article from The Motley Fool, “3 Things Every Good Retirement Plan Includes.”
Read MoreRetirement Contribution Limits to Change in 2018
If you are saving for retirement, 2018 will be a good year for you, according to a recent article in Kiplinger’s “2018 Retirement Contribution Limits for 401(k)s and IRAs.”
Read MorePhases of Estate Planning, From Saving to Preservation
It’s hard to imagine during your 30s or 40s that retirement will actually arrive. Life is busy, with careers, raising families and saving for retirement, including investing in IRAs, 401(k)s and other savings vehicles. During those years, your estate plan is a necessary part of planning for retirement and protecting your family with documents that include a will, health care proxy and power of attorney.
As Marco Eagle’s article, “Money Talks: Estate planning tools” explains, the next phase is the retirement stage, when the focus shifts from accumulation to preservation and maintenance of the nest egg.
Read MoreData on Retirement and Health for Americans Presents a Challenge
As the government shifts retirement ages higher and employees are working later in life, the health of Americans is changing, and not for the better. According to a recent article in Think Advisor, “Americans Are Retiring Later, Dying Sooner and Sicker in Between,” millions of Americans will likely have shorter and far less active retirements than their parent’s generation.
The U.S. age-adjusted mortality rate, which is a measure of the number of deaths annually, increased 1.2% from 2014 to 2015, according to the Society of Actuaries. It’s the first year-over-year increase since 2005, and only the second rise greater than 1% since 1980.
Meanwhile, Americans’ life expectancy is stagnant, with millions of U.S. workers waiting longer to retire. The age when people can claim their full Social Security benefits is sliding up, from 65 for those retiring in 2002 to 67 in 2027. Nearly 33% of Americans age 65 to 69 are still working, along with almost 20% in their early 70s.
Postponing retirement can make financial sense: extended careers can make it possible to pay for retirements that last beyond age 90 or even 100. However, a recent study cautions about this calculation, because Americans in their late 50s already have more serious health problems than people at the same ages did 10 to 15 years ago.
Death rates can vary from year to year, but research is showing that the health of Americans is deteriorating. Researchers say that an epidemic of suicide, drug overdoses, and alcohol abuse have contributed to a spike in death rates among middle-age whites. Higher rates of obesity may also be a cause.
However, the declining health and life expectancy are good news for one group—pension plans. These plans must send a monthly check to retirees for as long as they live.
According to the latest figures from the Society of Actuaries, life expectancy for pension participants has gone down since its last calculation by 0.2 years. Today’s 65 year old American man can now expect to live to 85.6, and a woman can expect to live to 87.6.
For pension plans, the change in life expectancy could mean a 0.7% to 1% change in the plan’s obligations. That’s a significant difference.
Estate planning is important not just with regard to death, but also in the event of disability or a sudden decline in health. For more information, explore our website and contact us to schedule your consultation today!
Reference: Think Advisor (October 23, 2017) “Americans Are Retiring Later, Dying Sooner and Sicker in Between”
Read MoreHow to Give to Family With Warm Hands and No Taxes
Giving your children, or other heirs, gifts while you are still alive can be a very fulfilling experience: you get to see what they do with their early inheritance. However, many people aren’t sure about the tax implications of gifting. A recent article posted on nj.com, “Gift tax consequences for you and your heirs,” gives readers a general look at gifting and taxes. It should be noted that large estates often incorporate gifting as part of an overall estate plan and should have the guidance of an experienced estate planning attorney.
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