People have a lot of concerns to address in the years leading up to retirement. Estate planning is often far from the top of someone’s priority list, but it is still an important consideration. Those preparing for retirement typically look forward to enjoying many years of the leisurely retirement lifestyle.
The idea of thinking about the negative impact of age or their death is unpleasant, to say the least. That being said, those who take the time to address the challenges of aging and the inevitability of death may feel more comfortable during their retirement years because they know they have acted to protect themselves and their loved ones.
Estate planning can play a very important role in the process of preparing for retirement. Why do those thinking about the end of their professional careers often need to put together or reevaluate an estate plan?
The process requires a financial review
One of the reasons that estate planning can be beneficial for those on the cusp of retirement is the need to take stock of one’s finances. What someone has set aside for retirement can play a major role in the estate planning process. For example, if someone does not have a sizable nest egg, then they may need to consider the possibility that they might eventually require Medicaid benefits. Adults usually need to make any significant financial moves at least five years before applying for Medicaid, or they run the risk of incurring a penalty when they need benefits the most.
Adults who have gone carefully over their finances know what assets they need to protect, what they can leave behind for loved ones and what support they may require later in life.
People can make smart moves to protect themselves
Estate planning is not just about creating a will and leaving instructions for a funeral service. It also entails planning for incapacity and the need for long-term care in the future. Beyond the creation of a trust or other strategic moves to be eligible for Medicaid benefits, people may want to name someone to handle their medical and financial affairs if they become incapacitated. They may want to leave clear instructions in the form of advance healthcare directives outlining their medical preferences. People can even establish durable powers of attorney that can help protect them from guardianship if their abilities decline as they age.
Establishing a thorough estate plan can help someone feel more confident about their finances and legal protections throughout their golden years. Those who take the time to establish an estate plan can protect themselves and also the legacy that they hope to leave for their loved ones after they die.