Helping Clients Cope With Retirement Realities

Retirement is the ultimate goal of a worker, the eagerly anticipated moment when a person is again master of their own day and free from the tyranny of the time clock. However, an estate planner needs to consider some of the following issues to help a client make sure that potential fallouts of retirement are avoided:

• Not everyone needs to receive Social Security benefits starting at the beginning of retirement. Since benefits grow every year of deferement past age 66, some clients can be better served by waiting a few years to start taking payments to provide greater income down the road.
• Make sure the client applies applies for Medicare especially before they reach the age of 65. In addition, a supplemental insurance policy should be purchased to cover the gap that appears in Medicare benefits.
• Plan for long term care if the client reaches a state that requires 24 hour care. However, planning for long term care is tricky because of the great expense that is involved which means few clients can afford to pay out of pocket or purchase insurance that covers LTC.  As a result, many will be forced to divest themselves of all assets in order to qualify for Madicaid benefits. These options should be forthrightly explained to any client so they understand, and accordingly plan for, the eventuality of LTC.

See Lawrence Frolik & Bernard A. Krooks, Confronting the Realities of Planning for Later Life, Wealth Management, September 10, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.