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Looking at estate planning from different age perspectives

10/17/13 | By Chip Gordy, MBA, CRPC

I'm often asked; what is estate planning?

To answer that question, let's look at estate planning from different age perspectives; the 30 to 50 group; the 50 to 70 crowd and the 70 and above age bracket.

Between ages 30 to 50 you’re either getting started with a career and a family or have them in the works. You think, at least occasionally, about retirement and begin to accumulate an estate. By this point in your life you may have started a 401(k) or other retirement savings plans.

If you have children you think about their protection, if something unforeseen happens to you. Statistics show that you think life insurance, for both husband and wife, for the loss of either will cause a loss of support for the kids and added expense for the home. Maybe you’re still paying your college loans but want to start saving for your own child's college education.

On top of everything you are dealing with for your own family, you also need to consider and ask your parents questions about what their plans include. Have they prepared for possible long term care? It‘s never too early to invest in a plan for long term care

Between ages 50 to 70 there’s an overlap here; as you’re still acquiring your estate, and maybe rearranging your investments to reduce your risks. You’re still raising your children and possibly taking care of your parents. Make sure that you are covered for possible long- term-care. The odds are too great and the cost too big to ignore.

This is also a time in your life that you will want to focus on protecting your retirement. Many times people spend their retirement for the sake of their children's education. But remember this: many places will loan you money for education, but no one will loan you money for retirement.

For those ages over 70, now is the time when you start to reap the rewards of past planning. Your plans are reviewed and funds are moved according to how much control you choose to have over your assets. This is also a time in your life when you may identify some of the financial guarantees that past planning has put into place. It’s necessary for you and your spouse to review all insurance and investments and make necessary adjustments. This may be the time to distribute assets that you no longer use or need, to your loved ones

You may want to invest funds in an irrevocable trust for your children or grandchildren. (This is what you put your money into in order to move it out of your estate).

For instance, with an irrevocable life insurance trust you can use the annual gift exclusion of $14,000 per person and take the money to pay a premium on a life insurance policy on your parents.

As with any other financial and estate planning, it’s always a good idea to seek out professional advice.

Chip Gordy, MBA, CRPC is a Financial Advisor with Coastal Wealth Management, LLC, 10441 Racetrack Rd, Unit 1, Berlin, MD, 21811 and specializes in Wealth and Retirement Income Planning. He can be reached at 410-208-4545 or Registered Representative, Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Coastal Wealth Management LLC & Cambridge are not affiliated.


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