You have probably worked very hard in your entire life to accumulate what you have. You may have made many shrewd business and financial decisions over the years. But now it’s time for a financial evaluation.
Here Are A Few Of The Many Items To Consider
Take A Step Back
Determine whether your assets are structured properly. At this stage of your life, your adviser should be able to help you to determine whether your investments are in line with your life goals. For example, if you’ve retired. Then you don’t want to take the same risks that you took in your earlier days.
Structure Of Financial Plan
The structure of your financial plan is very important. Often, your financial plan can be re-structured. So as to provide income to help you pay for a Professional Caregiver or an Assisted Living Facility. Many times, you just need a few extra dollars every month to help ensure that you have the quality of life that you desire.
An often overlooked objective of a finance evaluation meeting with your adviser should be to determine: (1) Whether your assets can be used by the person(s) you have designated. And (2) that these named individuals can use your resources for your benefit. If you become suddenly incapacitated, who has access to your money? Anyone? Are you sure? If so, does this person know what is expected of them? Have you discussed your care wishes with them? Do they know how you would like your assets to be used for your benefit? Can they even access your accounts?
Some accounts are very restrictive. By this, I mean that they are often set up where only you can make decisions. Consequently, only you can move money from the account. If you are the only owner of the account and you become suddenly incapacitated. Then anyone else (even your spouse or kids) may have problems when they need to withdraw money. It doesn’t matter what the reason is. Even if one of the kids wants to withdraw money from your account to pay for your medical expenses. They may not be able to do so. If they are not listed as an authorized signer on the account. Or if you haven’t properly prepared a Power of Attorney, then it may require a Guardianship Order (which is an Order of the Court) to access the money.
Some accounts may have high penalties for early withdrawal or substantial taxes to pay (ex. IRA). That is if money had to be withdrawn in a lump sum. We have seen many families forced into a huge tax or penalty “hit” because they were forced (by life events) to withdraw money quickly to use for their Loved One’s benefit. Some pre-planning may have served to minimize the severity of this tax or fee.
The Financial portion of the Bridge of Life Plan is a very important, but often overlooked area. It is very beneficial if your Financial Adviser and your Elder Law Attorney can work together to craft a Plan to take potential future caregiving needs into account. Stay tuned until next time for more keys to your Financial Plan Evaluation for declining Seniors.