You may seem to have two goals that are at odds. You want to set aside a nice nest egg for your future heirs to enjoy. However, you also want to build up funds so that you are comfortable after retirement, even if you live to a very old age. How can you make your estate planning and retirement planning work together? The secret may be to make your trust the beneficiary of your retirement fund.
Mistakes Heirs Make with a Retirement Fund
It may seem to make sense just to leave your retirement fund directly to a beneficiary. After all, the funds won’t go through probate. However, there are some mistakes that a grieving heir may make which could seriously affect a retirement fund. For example:
- Taking the funds too soon – Your beneficiary may not realize there are large penalties for taking the retirement money too soon.
- Taking the funds all at once – Taking the fund in such a lump sum could result in half of what you saved going to Uncle Sam instead of your beneficiary.
Leaving the funds to a trust means that you can appoint a successor trustee to help dispense the funds at the right times. This allows you to leave the fund to your loved ones but not the responsibility of knowing when best to withdraw the money.
Wise Planning for Your Family’s Future
If you have assets, including a retirement account, to leave to your heirs, contact Petrov Law Firm today by calling 619-344-0360. We can help you to settle your affairs today so that your family can enjoy a comfortable future.Read More
Estate planning is about more than just deciding what kind of funeral you will have or who will receive what from your personal belongings. Long-term care, which is often necessary at the end of a person’s life, is a vital consideration. Why is this the case? Here are three reasons:
- It Happens to a Lot of People – While only about 1 in 10 people will spend over three years in a nursing home, over 40% of people will be there for at least some time. Whether you end up in a nursing home or an assisted living facility, failure to factor it into your estate plan can be devastating to your benefactors.
- It Costs a Fortune – An assisted living facility can cost upwards of $3,500 per month. As you can imagine, that can drain the estate of most seniors rather rapidly. A one year stay in such a facility can take over $40,000 from your estate. Even if you have millions, you didn’t earn it to give it to a private care facility, and estate planning is the right way to minimize costs.
- Your Health Benefits Probably Won’t Cover It – Many older ones make the mistake of thinking it doesn’t matter how much extended care facilities cost because they have Medicare, Medicaid, or some form of private insurance. You can choose to protect yourself with a long-term care insurance policy. Just be sure you don’t end up paying for the care in advance by means of exorbitant premiums.
Helping You to Prepare for the Future in Southern California
At Petrov Law Firm, we want all of our clients to enjoy their golden years and still have something to pass on to their family. Contact our experienced estate planning attorneys today by calling 619-344-0360 to get started on an estate plan that will meet your needs.Read More