Most baby boomers will face seven key events in their last stage of life that will color their finances and investments. Prepare for these events by thinking about them now.
Unlike earlier, happier events such as getting married, having children, and moving up the career ladder, some of these events may be dreaded. For this reason, many boomers may put off facing them, but lack of preparation can make a bad situation even worse.
1. Your parents will get old. You should start thinking about this now and begin gathering resources so you won’t be at a complete loss when your parents can no longer function independently. You should begin discussing with your parents: Health Status, Long–Term Care, Power of Attorney, Estate Planning.
2. Your parents will die. This is the natural order of things. You will face both emotional and financial issues when your parents die. Go to A Healing Place (www.ahealingplace.org) for insights and resources that can help with the emotional issues. As for financial matters, this is what you will face: The estate must be settled, Inherited assets must be managed.
3. You will fight to stay healthy. Boomers are starting to come to terms with aging, but serious illness is still largely unexplored territory for most of them. Boomers will be paying attention to their health, either working hard to stay healthy or managing chronic illnesses. A glimpse of what’s ahead: Navigating the health care system, High out-of –pocket costs.
4. You will reach retirement age. Boomers will reach the traditional retirement age at which they may take advantage of certain tax benefits and entitlement programs developed under the traditional retirement system. Boomers who aren’t thinking about retirement as such will still want to take advantage of them: Social Security, Medicare, Tax Issues.
5. You will need to manage multiple sources of income. Even boomers who say they’ll “never retire” will likely have multiple sources of income that will need to be managed. These may include the following: Self-employment income, IRA Distributions, Investment Income.
6. You will get old. Boomers can barely imagine it now, but like their parents, boomers themselves will get old someday. What types of assisted living arrangements will you want to consider? How will you pay for it? What can you do now to make this phase of life more comfortable?
7. You will die. Sorry to be so blunt, but you know it’s going to happen. Boomers seem to be somewhat more open to contemplating their own deaths than their parents’ generation, perhaps because they still see it as a long way off. Go to the Real Age website (www.realage.com) and take a test to find out your “real age” along with health tips that will help you “live life to the youngest.” As they review their lives, boomers are starting to consider legacy planning and ethical wills (https://celebrationsoflife.net/ethicalwills/). This life-centered approach to death can lead to some of the estate-planning tasks you should be executing now, including advance directives and wills. It’s a good idea to review your estate plan or specific tax situation with your estate attorney.
Reesa Manning is Vice President and Senior Financial Advisor at Integrated Wealth Management, specializing in retirement and income planning. For more information, call Reesa at (760)834.7200 or reesa@IWMgmt.com.
The above is being provided for informational purposes only and should not be considered investment, tax or legal advice. The information is as of the date of this release, subject to change without notice and no reliance should be placed on such information when making any investment, tax or legal decisions. Integrated Wealth Management obtained the information provided herein from third party sources believed to be reliable, but it is not guaranteed. Form ADV contains important information about the advisory services, fees, business, and background and the experience of advisory personnel. This form is publicly available and may be viewed at advisorinfo.sec.gov