Estate Planning Tips for Baby Boomers
As the members of the baby boomer generation make the transition from their working years to retirement, estate planning becomes more vital to their long-term financial wellness. For a variety of reasons, many boomers have put off this essential task, which increases the severity and variety of risks their family members may face as a result. We highly recommend the following estate planning tips:
Know What Your Children Expect—and What You Plan to Give Them
By and large, boomers’ parents were conservative savers. They came of age in the Great Depression, and that formative experience often led them to be cautious with their money. Many of them accumulated far more than they ever spent, and they passed that wealth on to their boomer children. But many baby boomers aren’t taking the same approach to money.
For one, the world has changed. Even boomers who’ve saved a lot may end up spending much of what they’ve accumulated, since retirements are likely to be longer and healthcare costs expensive. But there’s also an attitude difference. Active boomers may be planning on spending much of their hard-earned money on themselves. They believe they’ve done a lot for their children already and don’t feel the need to leave substantial assets to them.
If you plan on spending down most of your assets, you may want your children to know. It’s one thing to not leave money to the next generation, but if they are blindsided by your decisions after your death, they may be completely unprepared financially and emotionally.
Have a Plan for the End of Your Life
Many, if not most, boomers are still leading busy lifestyles, and they plan to keep doing so for some time. Boomers who value staying fit and healthy may not really be thinking about what will happen to them when the inevitabilities of aging finally do catch up. But while taking steps to live a healthy lifestyle is important to enjoying a great retirement, boomers shouldn’t stick their heads in the sand and assume they’ll be healthy forever. Sickness and disability can happen, and it will be easier for you and your family to manage if you have a plan.
Not only should you think about long-term care and how you’ll pay for it, you should also ensure you have end-of-life planning documents in place, like a healthcare power of attorney and living will and that they can be located.
Update Your Estate Plan
Many boomers have estate plans they created decades ago. The primary goal of those estate plans may have been to ensure that their children and surviving spouse were protected in the event of unexpected death. But as you age, your estate planning needs evolve.
If your children are independent adults, providing for them is no longer as critical. Plus, if it’s been two or three decades since you created your will, your life has likely changed in other ways too. You may have grandchildren who you want to receive part of your estate or new property that should be incorporated into your will. Or your family composition might have changed — you may have been divorced or widowed, for example. You may even have received a health diagnosis that is affecting your estate planning goals.
For all these reasons and more, boomers need to sit down and review their estate plans to make sure they are properly conveying all of their wishes as they exist today, looking toward their future.
Decide If and How You Want to Leave a Legacy
Boomers often want to find a way to leave a lasting impact on the world and support causes and organizations closest to their hearts. If you count yourself among those for whom leaving a legacy is important, now is the time to start thinking seriously about how you want to turn those legacy dreams into reality. If your goals are ambitious — like starting a foundation or a charity or endowing a scholarship — you should start planning now. The more lofty your goals, the more important it is that you take clear, concrete steps to turn your dreams into reality. After all, you won’t be able to do this after you are gone.
Not sure how to put these estate planning tips into action? Please call if you’d like to discuss this topic in more detail. We’re here to help.