Kent Larsson writes about the proper use of wills, advance directives, trusts, and other estate planning tools, and how how they play a vital role in you receiving proper medical care and helping you to preserve and pass on your assets to your loved ones.
What exactly is allowed in retirement accounts?
A new fiduciary rule has caused considerable confusion for consumers and their advisors, according to the Washington Post in "A new conflict-of-interest rule for retirement savers is causing a lot of confusion."
The Department of Labor set up a new rule on June 9 that says financial advisors who give investment advice to consumers about their retirement accounts, must act as fiduciaries of those consumers.
The easiest way to understand what the new rule means, is that advisors have to act in the best interests of the people they are advising. Investment advice must be based on the best thing for the saver, not the advisor.
Therefore, if an advisor would earn a higher fee from suggesting one investment rather than another, he or she cannot advise the saver on that basis. If the investment that pays the least to the advisor is better for the consumer, then that is the investment that must be recommended.
Many advisors are taking advantage of the new rule to make changes to how they manage retirement accounts.
The confusion surrounding the rule has given them the opportunity to make changes that customers may not like and place the blame for them on the new rule.
An estate planning attorney can advise you on any questions you may have about the new rule.
Reference: Washington Post (June 19, 2017) "A new conflict-of-interest rule for retirement savers is causing a lot of confusion."
Millennials also expect their own children will help them in retirement.
Millennials expect that their parents and their children will help them out in their retirement years, according to Financial Advisor in "Millennials Want Family Help in Retirement."
There are sometimes big differences between generations.
For example, 61% of millennials expect to receive an inheritance from their parents that will help them in their own retirement.
Many millennials also expect to receive retirement help from their own children. Their other retirement expectations are often similarly unrealistic.
On average, they expect to retire earlier than they probably will and they expect to live fewer years as retirees than is likely.
These misconceptions combine into a big problem for the millennial generation.
By relying on family members and having unrealistic retirement expectations, they risk not saving enough money now. By the time they realize their mistakes, it might be too late to do anything to correct them.
It is important that parents of millennial children talk to them about setting realistic retirement and inheritance goals.
Reference: Financial Advisor (June 6, 2017) "Millennials Want Family Help in Retirement."
“Many Americans confess that they are confused when faced with the myriad Medicare choices available to them. Others are simply not planning, nor saving enough to meet the challenge of health care costs in old age. In response, a whole new industry has sprung up nationwide.”
A recent iberkshires.com post, entitled “The Independent Investor: Elder Care in an Age of Confusion,” explains that it's called "life care planning." This is a corollary discipline for those attorneys who are practicing elder law. Elder law attorneys are, in effect, advocates for the elderly and their families. They handle a wide range of legal issues commonly experienced by seniors. Some of the issues deal with Medicare, Medicaid, Social Security, retirement, long-term care insurance and nursing home care costs. These lawyers can also draft wills and trusts, help families with special needs children, handle probate proceedings and issues, along with a host of other estate planning matters.
The concept of life care planning focuses on the level of care that’s required when someone becomes disabled or reaches a certain age. Life care planners identify the level of care the person needs, finds the appropriate care givers and then maps out the necessary private and public resources necessary to help pay for these expenses.
Realistically, when an individual reaches a certain age—or his or her health issues become more severe—someone has to monitor his or her well-being and anticipate the next level of care required. In many cases, those responsibilities are thrust upon a family member. But most of them are not equipped to make the proper, necessary medical and financial decisions. As a result, our loved ones don't get the care they need or, if they do, they pay an excessive amount from the family savings for it.
Life care planners are involved throughout the process. They help make those decisions for you and anticipate what will be needed in the future. These professionals will adjust your life care plan accordingly and find the best methods to pay for it.
Some elder law attorneys work with registered nurses and public benefits coordinators either “on staff” or on call. These attorneys also provide life care planning, such as sorting through benefits for those who are veterans and might qualify for aid.
Elder care can impact an entire family and future generations. If just one member of a family develops a debilitating illness, has a lengthy hospital stay, enters a nursing home or requires 24-hour nursing care, then life savings can evaporate in just a few years.
Speak with a qualified elder law attorney and address what could be one of the biggest risks to your retirement and well-being: a lack of planning in elder care and estate planning.
Reference: iberkshires.com (June 1, 2017) “The Independent Investor: Elder Care in an Age of Confusion”