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3 smart estate planning moves as you prepare for retirement

On Behalf of | Dec 14, 2022 | Estate Planning

Getting ready for retirement often means taking a hard look at your finances and your life. It is a natural and logical time to create an estate plan if you have not already done so or make important revisions to your existing documents.

Whether you are about to draft the first will you have ever created or update your documents to remove guardian designations for your now-adult children, there are a few estate planning moves that could benefit you and the rest of your family during your retirement.

  1. Think about Medicaid

With the exception of those who are truly financially independent, most adults in the United States do not have enough in their retirement savings to cover a long-term stay in a nursing home. It will cost thousands of dollars a month even if you have a shared room, and Medicare won’t cover those expenses.

To qualify for Medicaid, you will need to plan ahead of time, which will likely involve creating a trust or changing the way that you own some of your property.

  1. Think about debt collection

You may have major outstanding financial obligations when you die or large unexpected bills that arise later in life. A hospital could place a lien against your house, preventing you from securing a reverse mortgage that was a key part of your retirement plan, and other creditors could similarly take you to court over debts that you owe.

Even if you avoid collection activity in your golden years, your loved ones may have to worry about repaying your obligations after you die. Asset protection planning can preserve more of your resources for later in retirement and also for the beneficiaries of your estate.

  1. Express your medical wishes

When someone is young and healthy, they may feel strongly about avoiding narcotic pain relievers in most situations so that they don’t become addicted. They may also want intensive medical interventions if they have some kind of healthcare emergency.

Older adults, especially those with pre-existing medical issues, may not want such extensive medical support when their health declines. You have an opportunity to provide clear instructions for your loved ones in an advanced directive so that there aren’t any questions about your preferences for medical treatment.

Thinking about the challenges that you and your loved ones may face as you age can help you add the right documents to your estate plan as you prepare for retirement.