Estate planning for an aging population
It’s a fact — Americans are living longer. The average lifespan for men in the United States is approximately 76 years, and for women, it’s approximately 82 years. Compare that to the average lifespan of 65 years in 1950.
While a longer lifespan is great news, it also means that you’re going to need more financial support as you age. Without proper planning, a longer lifespan could cause a significant financial strain during retirement. According to a study conducted by AARP, two out of three Americans are more concerned about running out of money than they are about dying!
Aging population projections estimate that the number of Americans aged 65 and older will nearly double from 52 million in 2018 to 95 million by 2060. Therefore, people planning for retirement need to consider a longer lifespan with respect to wealth management and estate planning. A recent report published in the Wall Street Journal highlighted the fact that one out of three Americans are not financially prepared to survive into their 90’s.
Estate planning must be tailored to meet the demands that an increase in the average age will create. As people enter their late 70’s and 80’s, their needs and focus will most likely shift from managing their assets to needing them for long-term care and healthcare expenses as well as passing them on to their heirs.
What you need to know
Baby Boomers started to reach retirement age a few years ago. Based on current trends in life expectancy, their generation is going to have to prepare for a retirement that’s going to last longer than that of their parents.
The focus of estate plans in the past was primarily aimed at avoiding or reducing probate and estate taxes. However, less than .02 percent of the population in the U.S. is subject to a federal estate tax now that the exemption has been raised. Coupled with the fact that people are living longer, the focus of estate planning and wealth management should now be on minimizing capital gains and protecting assets to ensure a comfortable retirement.
Living longer makes money management very challenging. As you age, the need for long term care, housing, and other health and estate issues changes. As such, you need to be prepared as your needs evolve and change over time during your retirement years.
The Law Office of David W. Foley, located in San Diego, offers its clients quality estate planning services that will ensure that not only you, but the people you love, are taken care of as you age.
What you need to do
With an increase in our aging population comes an increased concern about how money mismanagement can deplete assets that are needed for support. At the Law Office of David W. Foley, San Diego Living Trust attorneys, we can help you establish a living trust to hold your assets in a legal structure that will provide you with a higher level of asset protection while, at the same time, letting you retain control of your assets.
Being financially secure in your retirement is all about smart money management. Contact our office to set up a consultation with one of our estate planning attorneys.