Retirement is a time for you to relax and enjoy life after a lifetime of working hard. While you may not want to think about additional planning or life logistics now that you no longer have to go to a job every day, the reality is that there are some issues that you should not overlook now that you are in your retirement years.
Estate planning is a comprehensive term for a series of legal documents and decisions that you can make in advance regarding your financial situation and the distribution of your assets after your death. While no one necessarily enjoys having to consider issues surrounding mortality, if you plan in advance, you can bring peace of mind both for yourself and your family.
1. Writing a will
While you do not necessarily have to wait until you retire before writing a will, retirement is a good milestone to aim for. The American Association of Retired Persons, AARP, said that a survey showed that six out of ten Americans do not have a will. It said nearly half of those who responded to the survey did not have a will because they simply had not gotten around to doing it yet, while another nearly one-third responded that they did not have enough assets to merit a will.
2. Setting up advance directives
Advance directives allow you to designate a person you trust who can speak on your behalf if you are no longer able to do so due to an injury or unexpected event that renders you incapacitated. There are different varieties of advance directives, including a health care power of attorney, a living will, and a do-not-resuscitate (DNR) order. Consider your wishes as they relate to what you would want to express if you were no longer able to do so, and get those documents drawn up to protect yourself.
3. Update your beneficiaries
Do not neglect to occasionally review who you have designated as a beneficiary on your various accounts, such as life insurance, retirement accounts and bank accounts. If you have designations for people whom you no longer wish to have access to these accounts or funds, make sure you change the designations.
Not having a comprehensive estate plan can cause financial and emotional hardship for your family. Taking these three simple areas into account once you reach retirement may help you tie up some loose ends and ensure that your affairs continue to run smoothly, even after your death.