legal talk: planning for the newly retired

Planning for the Newly Retired BY LAUREN C. ENEA, ESQ

Congratulations on your retirement! You finally have time to work on your bucket list: traveling, spending more time with family and friends, taking up a new hobby, volunteering for a worthy organization. All great endeavors.

But the milestone of retirement is also a good time to make sure your finances, beneficiary designations, estate planning and long-term care strategy is in proper order. Here are some items to consider:

1. Create an inventory of your assets, accounts, safe deposit boxes, retirement accounts, beneficiary designations and digital assets.

Creating an inventory of all your assets will not only help when working with a financial advisor or estate planning attorney, but will also be invaluable to your family and/or spouse in the event you are unable to handle your own finances or pass away.

2. Review your monthly income needs and create a budget for your expenses.

The most obvious impact of retirement is probably to your income. Make sure you have reviewed and made any necessary Social Security and/or pension elections, and determined the Required Minimum Distributions (RMDs) you must take from your retirement assets (IRAs/401ks). Qualified monies typically do not require the RMD be taken until age seventy-two (72). That being said, your monthly income needs may require distributions from these accounts early. This decision, along with your Social Security and pension elections, should be reviewed with your financial advisor, plan administrator or perhaps an individual who specializes in optimizing Social Security and retirement elections.

3. Meet with an Estate Planning and Elder Law Attorney.

Ensuring your estate planning documents are updated is crucial during this next chapter of your life. You will want to designate an agent to make medical decisions for you in a Health Care Proxy, along with an agent(s) to make financial decisions for you in a Power of Attorney, in the event you are unable to make said decisions yourself. Your Last Will and Testament and, if you prefer, a Revocable Living Trust should be created or updated to ensure you’ve taken advantage of all estate planning options available to you and have properly named the beneficiaries, executors and/or trustees in accordance with your wishes.

If your assets are held in a revocable and/ or irrevocable trust, a probate proceeding will be avoided upon your death. A trust can also allow for ease of transition to those you want handling your affairs in the event you become incapacitated and can no longer manage your affairs. In addition to avoiding probate, an Irrevocable Medicaid Asset Protection Trust can be used for Medicaid Planning.

4. Engage in long-term care planning.

Engaging in long-term care planning will help you determine if and how you’ll be able to pay for the cost of your long-term care, in the event you need assistance in your home (a home health aide) or in an assisted living residence or nursing home. Paying for long-term care can be done in a variety of ways: by using your life savings; using long-term care insurance, or taking steps to become eligible for Medicaid benefits. Having a conversation with an Elder Law attorney may be beneficial to determine what your exposure to the cost of your long-term care is, and what steps you can take to minimize that exposure.

n n n Lauren C. Enea, Esq. is an Associate at Enea, Scanlan & Sirgnano, LLP. She concentrates her practice on Wills, Trusts and Estates, Medicaid Planning, Special Needs Planning and Probate/Estate Administration. She believes that it is never too early or too late to start planning for your future and she enjoys working with individuals and families to ensure that their estate and long- term care plan best suits their needs. Ms. Enea is on the executive committee of the New York State Bar Association (NYSBA) Elder Law and Special Needs Section and is also the Co-Editor of the NYSBA Elder Law and Special Needs Section Journal. She is admitted to practice law in New York and Florida. She can be reached at 914-948-1500.

What steps have you taken to protect your life savings from the cost of long term care?

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