Study Shows Retirement Targets Have Shifted

The COVID-19 pandemic presented a unique set of challenges for financial and retirement planning and now investors are looking ahead to the future with different priorities. A recent research study from Northwestern Mutual shows that over one third of Americans have pushed back or moved up their target retirement age directly as a result of the Covid crisis.

One quarter of those who participated in the survey said that they plan to retire later than expected even though 11% said they plan to retire earlier. The vast majority of those who are planning to delay will push out somewhere between 3 and 10 years.

The youngest generations participating in the study intended to leave the workforce before age 60. Some of the top reasons most people in the study are delaying retirement have to do with the desire to save money and work while also getting flexibility in their workplace.

Other concerns include the rising costs for medical and health care issues and direct withdrawals that were made from retirement savings during the pandemic. Another group of people had also had to take care of friends, relatives or additional dependents during the pandemic.

Together, your retirement plan and your estate plan work hand in hand to support your needs and help you adapt for life after you stop working full time. From income streams to giving to long term care, having the help of a Virginia Beach estate planning lawyer can be instrumental in covering all your bases.

If you are curious about how to align your estate planning in your retirement goals, do not hesitate to reach out to an experienced and dedicated estate planning lawyer.


Study Shows Women Are Rarely Involved in Couples’ Retirement Planning

When you and your partner are thinking about your future together in retirement, have you had conversations to get on the same page about your savings and expense strategies? Retirement is a lifestyle adjustment, especially when you’ve been used to working regularly and relying on that consistent income to pay your expenses.

When saving for two or combining two different retirement savings strategies for a married couple in Virginia, it’s key to think together about how you will make it work.

A new study identified that over 1/5th of women have no part in retirement planning as part of a couple. The Fidelity Investments’ couples and money study discovered that although 57% of survey respondents indicated they are joint decision makers on long term financial goals and retirement, over half of all non-retired couples disagreed on how much money they’d need to have set aside in order to retire comfortably.

Many of them have a discomfort level when it comes to talking about money which could also generate problems as it relates to estate and asset protection planning.

Over 22% of women involved in the study say they had no or little involvement in retirement planning. Women cannot afford to ignore the impact of potential retirement planning particularly given their higher rates of longevity. Women are also often entering retirement with fewer resources than their partners, making it more difficult to have the appropriate amount of money set aside to pay for a comfortable retirement.    

Don’t wait to talk about retirement.


Can a Charitable Remainder Trust Be Used to Generate Income in Retirement?

What if you were able to accomplish multiple goals in creating a trust at once, such as avoiding capital gains taxes, selling a highly appreciated asset and creating a steady stream of retirement income for your loved ones? These are just a few of the most common pros of choosing a charitable remainder trust.

A charitable remainder trust is an irrevocable tax exempt trust that serves for the purpose of reducing your taxable income. These are becoming much more popular because they can reduce your tax liability overall. This is known as a split interest giving vehicle, meaning that the assets inside the trust are split between two different beneficiaries.

The initial beneficiary, which is usually the creator (you), a person you name and a charitable organization. There are a few different kinds of charitable remainder trusts but the vast majority of them function in the same way. The grantor who creates the trust contributes assets into it. This can be anything from cash to property to shares of stock or even artwork.

You’ll usually want to contribute something that is capable of appreciating in value and the terms of the trust from that point on are those that you set. Speaking with a trusted Virginia Beach estate planning lawyer can help you to determine whether or not a charitable remainder trust makes sense for your individual situation.


Study Shows More Americans Want to Retire Early

Have you thought about your intended retirement target age? For most people, turning 65 means leaving the workforce at least in a full time role, but that has been shifting over recent decades as more people stay longer in their positions for financial reasons or just not wanting to leave the workforce.

But a new trend is impacting potential retirement numbers and savings amounts: more Americans want to retire early. Studies show that one-third of employees under age 54 want to retire by the time they reach 55. Hearts & Wallets found that nearly 40 percent of consumers of all ages want to retire before 65.

Households closing in on that target age of 55 for their own retirement have some characteristics more likely to make them successful. They spend less on housing, are open to financial advisor, use investment products, and have lower student debt amounts owed. But these are hindered by things like high credit card debt and low savings rate.

Behavioral changes in this area could help them get back on track, but this is just as important as engaging with a team of experienced professionals to ensure that these pre-retirees have covered all their bases.

From a financial advisor to an elder lawyer to a CPA, there’s a lot to think about as you approach older age. Both from the perspective of enjoying this chapter of your life and making sure you have safeguards in place to protect you, you need a holistic plan that takes all these unique facets into consideration.

For more help, schedule a consultation with an estate planning lawyer.

Three Tips to Maintain Your Savings in Retirement

Approaching retirement means thinking about your finances and your working life differently. For plenty of soon-to-be American retirees, it’s just as important for them to protect their savings as it is to have a good plan for spending it during their retirement years.

There are many different risks that can impact retirement plans today, most particularly, their impact of long-term care expenses. Three tips can help retirees be more mindful of the balance inside their retirement savings accounts and how best to protect it. The first of these is to look for a fiduciary or a financial advisor who will put your best interests ahead.

There are many different financial professionals who are targeting the retiree market for those who are high net worth. It’s a good idea to work with someone who has a fiduciary responsibility and will help you understand where you are at now and where you hope to be in retirement. The second step is to make sure that you have an advanced wealth planning strategy and a relationship with an estate planning lawyer.

An estate planning lawyer could help you see some of the different ways that your retirement plan could be affected, not only to support you in your older years but to leave gifts behind for your loved ones. Finally, think about the big picture.

Maintaining wealth goes beyond income and investment returns. Look for advice from a variety of professionals that can help you better understand things like health care planning and taxes. For more information about drafting a retirement plan that aligns with your estate planning goals, schedule a consultation with an estate planning lawyer in Virginia Beach today.



Three Changes to Retirement Savings That Might Impact You in 2021

The CARES Act or the Coronavirus Aid Relief and Economic Security Act gave some significant benefits to retirement savers in 2020. However, the disappearance of these in 2021 means you may need to consider alternative planning options. The first major change has to do with required minimum distributions. In 2020, the CARES Act enabled savers to skip required minimum distributions. However, these will need to be restarted in 2021. The second change relates to retirement plan withdrawals.

Under the CARES Act individuals younger than age 59 and a half are eligible to remove up to $100,000 from their retirement accounts without being subjected to the typical 10% penalty. The early withdrawal penalty, however, is back in effect in 2021 so don’t make any sudden changes or removals to your retirement plan anticipating that you may be able to leverage this now expired benefit.

The third issue relates to retirement plan loans. Savers with particular 401(k) plans were eligible to borrow as much as $100,000 from their accounts and to defer payments on those loans for a year. Although that change has been expanded into 2021, you’ll need to be with your financial professional to determine if you meet the qualified disaster requirements to do so.

The amount you are eligible to contribute to retirement plans in 2021 hasn’t changed. IRA investors can set aside up to $6,000 and those who are older than age 50 can set aside another $1,000 for a total annual contribution of $7,000. For more information about how this might affect your estate plan, set up a consultation with a lawyer in Virginia Beach.    


What Questions Should You Ask Yourself for a Purpose Driven Retirement?

Anyone who is approaching retirement has likely had a sense of purpose their entire life. This makes it all the more important to view this transition as yet another opportunity to open this new chapter in your life with a good sense of purpose. Looking ahead to retirement is not always just about exiting the workforce.

Do you know what you want your retirement to look like? And have you created all the tools and plans to make that happen? To accomplish your goals and help make this transition easier, be thoughtful about the process.

In fact, you might want to think about how you’ll navigate this transition by asking a couple of key questions that will help you prepare for a purpose driven retirement. These include:

  • Which goals do you have and how will you prioritize them with your new time? Do you want to pick up a new hobby, start a new business, or volunteer somewhere?
  • Can I still afford to enter retirement at the age I originally planned to? Recent events and changes in your own investment portfolio might prompt you to step back and look at whether or not now is the right time to retire or whether you may need to adjust your plans.
  • How will I incorporate giving and philanthropy into my overall financial and retirement strategy?
  • Do my estate planning documents still align with what I intend to happen during my older years and after I pass away?

Now could be a great opportunity to engage the services of professionals who can help you navigate this new transition and ensure that you have thought about it from all different perspectives. Schedule a consultation with a trusted estate planning lawyer to learn more about this.


Is it Time to Revisit Your Financial Plan?

Deciding to retire brings with it a variety of different logistical decisions that need to be made but also plenty of emotions about making this transition in your life. Concerns about your financial future and excitement for the new freedom you might face are both common feelings and many people have these at the same time.

By reviewing or executing a financial plan for your retirement, which incorporates your estate plan and how you intend to take care of yourself in older age and pass on assets to your children will give you peace of mind so that you have something to build and adapt from.

A comprehensive financial plan needs to include many different components, looking at each aspect of your individual retirement. This includes spending habits, the design of your current portfolio, account balances, personal retirement plans like gifting, estate planning and travel, and insurance planning.

Each of these plays at least one small part in your overall retirement playbook. It’s a good idea to look at things from the data that can give you a good idea of what you need to have saved and some of the challenges that you might experience if you don’t adapt your savings plan now.

Plenty of people are nervous about having enough set aside for health care expenses, for example, so you might want to discuss with your elder lawyer whether or not the long term care plans you have in place will be enough. Schedule a consultation today with an elder lawyer in Virginia Beach to learn more.

Study Shows the Pandemic Has Influenced Retirement Plans

Retirement and estate planning are inextricably linked. This means that you can’t consider one without properly considering the other, and world events can certainly have an impact on your overall level of confidence in your estate planning.

A recent study by the TransAmerica Center for Retirement Studies found that one out of five millennials say that their confidence in their own ability to comfortably retire in the future has declined because of the pandemic. That decline increases based on the survey respondent’s age.

A total of 32% of Baby Boomers feel like they have lost confidence in their ability to retire comfortably with one quarter of GenX expressing the same concept. Every generation certainly faces challenges with their retirement strategy, these three generations have a lot at stake.

Those three groups are most important for the purposes of this research project because they are the most prominent groups in the workplace today. Many in each generation already had plenty of work to do when it came to saving for retirement. Even though millennials have the longest period of time to build up their savings and the weather some storms in the stock market and beyond, they also have the most significant student debt that’s hanging over them.

Boomers were already hit hard by the great recession and the pandemic might only increase those challenges and GenX has already been noted in numerous studies as behind in their retirement savings and also crippled by credit card debt. This is a good opportunity to reevaluate your prospects and goals. Scheduling a consultation with an estate planning attorney in Virginia Beach could be the first step.



Retirement Planning Beyond the Basics

There’s no doubt that the workforce is changing and as more baby boomers are reaching retirement age, this is also raising questions about how retirement is different. Traditional retirement planning might not cut it anymore, particularly if you’re not using comprehensive estate planning tools to target your goals. What is important to consider is making a written retirement plan for your financial and non-financial aspects of your life.

Establishing habits now before retirement makes things easier. While money is certainly a crucial component of your overall retirement plan, you shouldn’t be afraid to use some of the savings you’ve established to create a better life now instead of waiting until later. For example, investing in relationships and in better health can pay off in spades and cut down your overall costs in retirement.

Retirement is ranked 10th out of 43 total stressful events. Some people feel disoriented or overwhelmed in the first couple of years of retirement. There’s no doubt that you’ll be concerned about your life savings being gone before you are, and this is why traditional retirement planning largely focuses on the money.

However, don’t forget about non-financial retirement issues. Living longer makes many people confused because they don’t know what to do about it. Some people fear that living longer just means they are less capable for longer periods of time due to incapacitating events or cognitive issues.

Long-term care planning, brain health considerations, and life insurance are all important. Putting together a written non-financial estate plan should begin by looking at things like family beliefs, values, and traditions. This makes it a lot easier to identify the legacy that you intend to pass on to future generations with ease. Schedule a consultation with an experienced estate planning attorney in Virginia to learn more.