LEGAL MATTERS
You can use several legal tools to maintain control over your
affairs in later years. These will enable you to decide, while
healthy and alert, what you want done in the event of death or
disability. Be sure to discuss any arrangements with your
survivors to save them from facing difficult decisions and to
give them peace of mind, knowing they are complying with your
wishes.
- Wills -- If you do not have a current will, the state, not
you, will decide how your assets are divided. Such legal
documents as Living or Revocable Trusts offer ways to avoid
probate.
- Trusts -- This device lets you decide who would be responsible
for your financial affairs if you became unable to manage them
yourself.
- Powers of Attorney and Living Wills -- Powers of attorney
typically assign responsibility for financial matters to another
person. Some apply to health care decisions as well. You can use
a Power of Attorney or a Living Will to state in advance your
wishes in case of an incapacitating or life-threatening illness.
Doing so is essential if you want your family to know the
circumstances in which you wish to decline life-support measures.
RELOCATING OR STAYING PUT
Where to live after retirement is a major decision. Perhaps you
plan to relocate to a more favorable climate or to be near
family. Research the consequences of such a move in terms of the
basic cost of living, access to health care, and state and
federal tax obligations.
If you are considering the advantages and disadvantages of
selling your home, whether or not you plan to relocate, these are
some questions to ask:
- Can we afford monthly payments for mortgage, taxes,
utilities, and maintenance?
- Will one or both of us be able and willing to take care of
the house?
- Is the house a suitable place to live as we grow older and
less agile?
- Will we need to draw on our home equity as a source of income
or credit, or would we have more options if we sold the home and
invested the proceeds?
In addition to owning a home or renting an apartment, a number
of other housing options may be available in your community, many
of which offer savings on housing expenses. These are some
alternatives to consider:
- House-sharing for help with chores or added retirement
income;
- Group living in a private home or one sponsored by a social
services agency;
- 'granny flats', or mobile or manufactured homes, which, if
local bye-laws permit, can be installed on the property of an
adult child or other relative;
- Housing associations, flats or cooperatives which have the
advantages of home ownership without the burden of maintenance;
- Retirement communities which may offer companionship,
recreation, and sometimes medical and housekeeping services.
SPECIAL CONSIDERATIONS
An important part of financial planning is anticipating how to
handle bad times. Prudent planning includes learning about public
and private benefits programs. In most communities,
governmental and private agencies offer services to help care for
older persons, such as low-cost medical clinics, home health
care, housing options, adult day care, and home help services.
The local Social Security office has information about
entitlement programs such as medical assistance, disability
insurance, and Supplementary Benefit. Ask about rules which
permit transfers of some assets to other people if done a
specified length of time before applying for assistance (usually
at least three years). This is a precaution some take to avoid
"spousal impoverishment" when all the family's assets are spent
before a sick family member can be eligible for assistance.
When arranging family matters, it will ease your survivors'
emotional burden if you let them know your preference for funeral
or memorial arrangements. You can handle these matters yourself
by planning through a non-profit cooperative memorial society or
by prepaying at the funeral home of your choice. If you decide to
pre-pay, be sure you or your survivors can cancel the contract
should you move or change your mind. Planning ahead and using
comparative shopping skills can save thousands of dollars in
funeral expenses.
PLANNING TO STAY INDEPENDENT
It's never too early to start retirement planning, and never too
late to make adjustments in your financial situation. Whether
wealthy or not -- and it is probably more important for those who
are not -- investigating your options and making practical
choices now can allow you to stay in charge and meet future
financial goals.
