Americans aged 50 or more are experiencing gray divorce more than ever. The term gray divorce generally refers to the baby boomer generation and affects all classes and education levels. Research shows that splitting during middle age is particularly damaging to your financial well being. According to Bloomberg News , the US divorce rate for couples past the age of 50 has doubled since 1990 and occurs most often in people who have married and divorced more than once. The rate of divorce among remarried individuals is 2.5 times higher than those in first marriages. And the financial outlook is usually the bleakest for those who have married and divorced more than once. Losing accumulated wealth for a second or third time can ruin personal finances on an unprecedented scale.

As such, relative wealth can be a protective factor in keeping couples together. Midlife marriages are not always torn apart by empty nest syndrome or a late mid-life crisis. Often, divorcing couples are already experiencing financial problems due to unemployment or job insecurity. These couples may not have the resources to enter into marriage counseling and may not see the point in fighting to remain in an unsuccessful economic partnership. Married couples with more to lose in divorce will often keep a less than perfect marriage viable to protect a lifestyle they are unwilling to forfeit. These couples will often live separate lives but maintain the economic structure within the marriage.

Susan Brown, who is co-director of the National Center for Family & Marriage Research, explains that if you are getting a divorce after the age of 50, expect your wealth to decrease by 50 percent. Brown goes on to state that the depression rate for those experiencing gray divorce is higher than the levels of those who have experienced the death of a spouse. If you are a woman and going through a gray divorce, expect your standard of living to plunge by 45 percent compared to a man’s 21 percent. One of the biggest financial tragedies of gray divorce is there is no appreciable window of time to recover the wealth you lost. The event horizon of your life is shrinking, and there is no time to undo the financial destruction. Even qualified career individuals will find ageism is rife within the corporate hiring sector. The prospects for landing a great new job or winning a lottery are very bleak. Statistics show you will be most unlikely to recoup your previous standard of living. This fact is particularly true in the case of women aged 63 or more who, in part, are experiencing poverty rates of 27 percent because of gray divorce. The Journal of Gerontology projects that by the year 2030, more than 828,000 Americans will be divorcing each year even if the gray divorce rate stays the same.

What to do if you become a gray divorce statistic then? One of the best ways to recover is to re-partner. Many older people are looking to re-couple and the digital age is providing more ways to meet than ever before. Online dating sites for older Americans are popular as are the more traditional senior community centers to make connections to like-aged people. If you choose to remain un-partnered however, you can expect to take about four years to end the depression cycle of gray divorce. However, remarrying or re-partnering will end the depression almost immediately with the stipulation you have chosen your partner wisely. Generally, re-partnering is more successful if you are a man since they tend to look for a partner who is significantly younger than themselves. As women live longer than men and because men do tend to seek younger women, older women are left with a vastly smaller pool of potential partners.

Protect your well being and financial interests from gray divorce. Your best hope is to stay successfully married and continue on the path of building wealth and enjoying retirement years. If you find yourself going through a gray divorce, be sure to seek trusted legal counsel who can best advise you on how to protect your assets and future retirement years. Whether you are on your first, second, or third marriage take a look at how best to protect your financial picture in the event gray divorce happens to you.

If you have any questions or need guidance in your planning or planning for a loved one, please do not hesitate to contact one of our six offices by calling (866) 456-9668.

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Although it can be useful to have another party available to keep track of bills when you’re sick or away, adding a child’s name to a bank account may be more of a hassle than it’s worth. Doing so may have unintended consequences for both you and the child.

First of all, the money in your account could be diverted to unintended parties. As of 2015, if the account held anything over $14,000, you would have had to notify the IRS and possibly pay gift taxes. If the child divorces, is in debt or has a legal judgment against them, the account becomes available to the ex-spouse, creditors, or plaintiffs, just because the child’s name is on it.

Secondly, putting someone’s name – and a potential beneficiary’s name, at that – may frustrate the intentions of your will. Because your child’s name is on your account, they have “rights of survivorship,” which means that the entire account goes to them. If you wanted your assets divided equally between your children, for example, then whichever has their name on the account will now get more than the other.

Third, your child could lose eligibility for public funds, and your grandchildren could lose the opportunity for scholarships and financial aid. If your child ever needs public assistance, such as Medicaid, the account will be counted as an available resource and may make them ineligible. Likewise regarding your grandchildren; they may not be able to get student aid if the account which their parent’s name is on inflates their parent’s assets.

Finally, there are a few other potential consequences. If your child dies before you, then the money in the account (if held as tenants in common) could be part of their estate and would be distributed under the terms of their will, rather than yours. Or if your child spends the money in the account without your permission, because their name is on the account they would not be required to pay you back. Either way, the money in your account would have ended up out of your control.

Even though adding a child’s name to your bank account seems harmless, it can backfire, and lead to consequences for both you and your child.  We can help you find ways to protect your bank accounts during your lifetime, and pass money on to your children without the threat of creditors reaching that money.

If you have any questions or need guidance in your planning or planning for a loved one, please feel free to contact one of our six office locations by dialing (866) 456-9668.

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In the United States, turning 65 years of age is a milestone on many levels, but before this birthday, there is a hefty checklist that you need to address to continue aging successfully. Overall the most crucial thing to do before turning 65 is to invest your time wisely crafting the best approach possible for your health and financial security well-being.

Can you afford to retire? Are you married? Estimate your total annual spending , including a cushion for periodic or unforeseen expenses like home repairs or dental work. Total all of your potential retirement-income sources and understand the tax implications associated with their spending. Run through several scenarios where you change what year you claim social security benefits to see if you should defer collecting it to a later age. Be realistic and start adhering to a modest budget today. Very few Americans can withdraw a lot from personal savings and investments without risking running out of money too soon. As you start to gather your assessments in general about how you view your retirement, find a qualified retirement planning expert that can help you with projections that are based on realistic assumptions.

There are resources available to help you understand what your options are and the best way for you to proceed. As you approach the age of 65 many private insurance companies will lobby for your insurance dollars that will be spent on supplemental insurance. Finding a retirement planning company with insurance brokers that can sell you policies from many different insurance companies is more advantageous than locking into a group that will only sell plans that are associated with their company. A reputable insurance broker should not charge for helping you to assess your situation as they make commissions from the insurance company providing the policy to you. Check with the Better Business Bureau (BBB) online where you can plug in the name of an insurance group or retirement counselor and find out how long they have been in business, their accreditation, BBB rating, and customer reviews and complaints.

If you are over the age of 50, you can contribute an extra 1,000 dollars annually to your IRAs and an additional 6,000 dollars to 401(k)s up until the age of 65, according to Kiplinger. If you are still working, this is an excellent way to boost your retirement spending money. Before 65, you need to explore the option of a long-term care insurance policy , which helps to pay for any assisted living care needs you may require in the future. Long-term care policies can be expensive. If you do not enroll in a long-term care plan before the age of 65, the policies will become practically unaffordable.

Before turning 65, you should also come to terms with your will, advance medical directives, trusts, and the difficult conversation with your spouse or children about your end of life wishes and any funeral arrangements. Take heart, turning 65 is far from a death sentence as many Americans are living long and active lives well beyond the age of 65; however, meeting with an elder counsel attorney can save you and your heirs’ plenty of money and heartache. Do not wait until an adverse medical event forces your family or loved on to act on your behalf financially or medically. Decisions made under duress do not provide the best outcomes. Beyond your will, power of attorney and power of medical attorney, consider a dementia directive as well. Projections for the aging US population indicate an ever-increasing number of seniors who have Alzheimer’s and other forms of dementia. Your elder counsel attorney can guide you through your options. Some states even have working templates for dementia directives. As you age, you can review your legal strategies from time to time and make adjustments as you deem necessary. It isn’t easy to discuss your end of life scenario, but once you have had the discussions and put proper legal documents into place, you can move forward with a sense of relief. It is freeing to make decisions and act on your future behalf, knowing you can always revisit your choices.

Now for the fun stuff; get excited about the senior discount. While it is true that there are discounts available as early as 55 and 62, nothing beats the senior discount at age 65. You can check off that bucket list of yours with deals on restaurant meals and travel excursions, clubs, retail stores, hotels, cinemas, smartphone plans, AARP membership discounts, and more. If you do not see an offering for a 65 senior discount posted, by all means, ask.

Beyond Medicare eligibility, you can get a onetime free physical exam if you have Medicare Part B insurance coverage. Gyms and community programs offer discounted or free physical fitness programs so that you can keep yourself moving and as healthy as possible. If you have Medicare, check out your eligibility for SilverSneakers for a 65+ fitness program. Your local senior center can keep you socially active and connected to people your age. Making friends and enjoying the simple act of conversation is known to have many benefits for your cognition and staves off isolation and depression issues.

If you retire from your job at 65, you can finally begin to collect on your pension plan or 401(k). That in itself is worth a celebration after many decades of hard work. You might also opt to collect your social security benefits, but it is generally advisable to wait until you reach full retirement age.

Homestead benefits and property tax exemptions are a considerable benefit for those who already own or plan to own a home or property. Benefits vary by state, so you will need to see what you can qualify for where you live. Your local comptrollers’ office can provide information about offers regarding homestead benefits. For property tax exemptions, you must contact your local comptroller or tax assessor’s office for exemption information.

There is a lot to discover, learn, and know about how to proceed in life at age 65 and beyond. With Social Security benefit determinations, health insurance policies, and legal documents in order, you can begin to enjoy being 65. Start your education about being 65 or more today. Stay vibrant and healthy and enjoy those things you dreamed of doing when you were your younger self.

If you have any questions or need guidance in your planning or planning for a loved one, please don’t hesitate to contact any of our six office locations by calling (866) 456-9668.

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It is essential to bring up a parent’s aging expectations and set goals together even though initial discussions may be uncomfortable. Often, an exploration into a parent’s future thoughts about health, finances, and residential plans can make the difference between reacting to a crisis or following an established plan that can bring both the parent and their children peace of mind. The sooner an identified caregiver begins a dialogue, the better the outcome for all involved.

It is common for an older parent to try and shield loved ones from some of their harsh realities – whether financial or health-related – because they are reluctant to accept help, embarrassed by their finances and don’t want to be a burden, or are hiding some critical health information. Even in the best of health circumstances an older parent’s ability to remain independent and manage their life can be challenging. Family caregivers are essential to the experience of aging in America and while individual care needs vary there are some general topics to address when helping an aging parent.

Safety issues are paramount. If there are assets and retirement plans in place, do not allow an aging parent to become financially vulnerable. In the most recent report released by the Department of Justice (DOJ) more than 2 million elderly Americans were defrauded out of more than 750 million dollars in one year. Get educated and learn systems that can protect parental assets. Physical safety must also be addressed to prevent accidental falls in the home. Technology can be adapted into the home to have environment lighting controls and other comforts that can keep a parent safer. Driving is also a topic that needs to be discussed. At what point is it best to remove a parent from behind the wheel to avoid unintended accidents that can be costly both financially and health-wise.

Activities of Daily Living (ADLs) and Instrumental Activities of Daily Living (IADLs) are the basic foundation of day to day functioning. IADLs include chores such as managing finances, transportation, home maintenance, shopping, and meal preparation. ADLs include eating, bathing, getting dressed, toileting, transferring and continence. The level of need in the described activities generally determines the sorts of care and housing arrangements a parent, caregiver, and family must consider.

Health and medical issues are pervasive as a parent ages. Many elder parents suffer from chronic conditions requiring medications, management, and monitoring. A caregiver may notice new health concerns that will need attention and routine visits to physicians to diagnose any new medical conditions. Dementia and other serious chronic illnesses can cause a parent to lose their ability to manage their health decisions or oversee their medical care. A medical power of attorney becomes necessary in the event a parent is no longer able to make sound decisions. All of these legal and financial issues that address health directives must be documented with the necessary legal paperwork. Legal designations such as a will, trust, and power of attorney are also essential to have in place. When the time becomes necessary, this documentation affords a designated power of attorney, and medical power of attorney the right to act on a parent’s behalf without the time-consuming need to address the courts for permission. Very often a caregiver is assigned these legal designations. Planning for a parent’s inevitable future decline, emergencies, and end of life care goes a long way to helping reduce stress, hassles and sometimes expense.

Housing issues are at the forefront of successful aging. Is a parent able to age in place, particularly with the aid of technologies that simplify their day to day living? If they are not, what sort of environment is best suited to their current needs? Do they need to move in with a family member or might they require assisted living? If so, is that financially viable? How does housing address the parent’s quality of life? Beyond the basic needs, a caregiver and family should want a parent to thrive, not just survive. It is essential to learn what matters most to the parent and what they would be willing to compromise on if the need arises. A parent’s desire for social connections, autonomy, dignity, and purpose must be considered to ensure a positive quality of life.

Finally, the management of family dynamics and relationships often brings many challenges and painful emotions to process. A caregiver deals with relationship stresses that can include physical exhaustion, financial depletion, and emotional burnout. A caregiver is only as useful to a parent as they are to themselves. While setting boundaries can be difficult, establishing frameworks that designate acceptable norms are healthy for all involved. A caregiver who puts their well being in jeopardy will also affect their ability to care for a parent. Some strategies for wellness in a caregiver’s life include: joining a support group, asking family members for help, learning to say no when needs outside established boundaries arise, and allotting time for themselves.

There is much to consider. Planning can become complicated as human emotions and relationships are involved when setting forth caregiving expectations and parent aging plans. We help families navigate the aging process and plan for how to find and access appropriate care.

Contact any of our six offices today by calling (866) 456-9668 and schedule an appointment to discuss how we can help you with your planning.

The post Be Mindful of These When Caring for an Aging Parent appeared first on Faloni Law Group.

When the US federal government established its social insurance program on August 14, 1935, its purpose was to provide retirement, disability, and survivors’ benefits. Since that time, in part due to the disappearance of extended family networks, an increase in population, and a profound increase in life expectancy, it has become challenging for the Social Security Administration ( SSA ) to maintain the benefits promised to Americans.

According to a Transamerica survey , 80 percent of Millennials (born between 1979 and 2000) do not think they will receive any Social Security benefits at all. This apprehension comes as no surprise because for decades Americans have been saying that the Social Security benefits system is going to go broke. Millennials may be right to be skeptical about receiving benefits three and four decades hence, and the program does have problems but is not going broke, yet.

By its admission, the Social Security Administration reports that the Old-age and Survivors Insurance (OASI) Trust Fund and the Disability Insurance (DI) Trust Fund are scheduled to be depleted in the year 2034 if Congress doesn’t act. However, there is another source of income for Social Security benefits. Even in the absence of both SSA Trusts, hundreds of billions of dollars in payroll taxes will still be collected and billions in benefits will still be paid. Even if Congress did not intervene to address the current challenges, the system would still be able to pay 77 percent of projected benefits beyond the year 2034.

Because of the bipartisan support the Social Security program receives and influential lobbies including the very powerful American Association of Retired Persons ( AARP ), it is highly probable that Congress will intervene to strengthen Social Security’s finances. Millennials’ uncertainty about the program’s solvency may lead to poor decision making regarding their retirement savings and plan. It is never too early to start looking at the basic tenets of when you will be able to retire successfully. Just because Millennia consider the future of Social Security benefits as tenuous, it should not deter them from saving money, investing, and reviewing and updating plans as circumstances change.

Data source: Social Security trustees

The average Social Security benefit is currently slightly less than 1,500 dollars a month. To successfully use the financial planners 4 percent rule would require a savings of 400,000 dollars to generate a similar income to the average Social Security benefit. Projections by the Urban Institute estimate that Millennials will receive about one million dollars for a single adult of average-income and 2 million for a couple.

Maybe the good news about Millennials’ skepticism about the solvency of Social Security is their interest in starting retirement savings planning earlier than the generations before them. Millennials who are saving are beginning around 24 years old and with good reason. Pensions in the private work sector are becoming increasingly rare, employers may go out of business, and job-hopping is much more common among younger American workers, which can easily lead to errors in income reporting.

All Americans should create an account on the Social Security Administration’s website, which allows you to check your earnings records and have errors corrected. Even checking every three years is good enough to know that your Social Security benefits will track accurately based on your income. Before ever claiming your benefits, be sure to employ one of many software tools that educate you about claiming strategies for Social Security. Millions of Americans make the mistake of taking their benefits too early, which locks them into permanently reduced payments. The financial incentives the SSA provides for delaying when you take your benefits can net you up to 250,000 dollars more. Benefits currently increase between 7 to 8 percent for every year you delay after the age of 62, capping at maximum benefits at the age of 70.

Millennials are expecting their prime source of retirement money to come from self-funded financial vehicles like a 401(k), IRA, and other savings and investments and ultimately that is a good thing. There isn’t such a thing as “too much money” in retirement, so additional sources of income beyond Social Security benefits is an excellent strategy. The social contract the federal government made for, and funded by its citizens, in all likelihood will be there for the Millennial Generation but no one knows the future. With 18 percent of Millennials expecting to live to 100 years of age or more getting information and advice about how to achieve retirement goals is more important than ever before.

If you have questions or would like to discuss your particular situation, please don’t hesitate to contact any of our six office locations by dialing (866) 456-9668.

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America experienced its worst financial crisis since the great depression between 2007 and 2010. Known as the subprime mortgage crisis, it happened because home prices fell in 2006, triggering loan defaults. Then the risk spread into pension funds, mutual funds, and corporations who owned the derivatives. It also spread into the global credit market resulting in higher interest rates and reduced availability of credit. Quantitative easing was necessary for several years to lower interest rates and spur economic growth. The cautionary tale to all Americans was learning to live beneath their means and do not carry excessive amounts of debt. Many Americans did not take heed and as a result, they are in substantial debt. One of the saddest cases of all of the debtors is the senior in their 60s and 70s in retirement years, and generally on a fixed income.

According to marketwatch.com, the current financial debt crisis among seniors is worse today than it was in the earlier 2000s. First-quarter debt in the year 2019 among seniors in their 60s was 2.17 trillion dollars according to data from the Federal Reserve Bank of New York. That is almost 1 trillion dollars more than quarterly numbers being reported in 2008 just after the start of the great recession. Senior Americans in their 70s are experiencing double the collective household debt than in the late 2000s. Second-quarter 2019 debt is 1.16 trillion dollars comparative to the .54 trillion dollars of 11 years ago. While younger Americans are also experiencing debt, those numbers are more consistent or even lower than the quarterly obligations reported during the spring of 2008.

Mortgages account for the majority of household debt across all age groups with older Americans, aged 40 and beyond, typically holding the most debt. The trend of a home equity line of credit (HELOC) is highest among those in their 50s and 60s. In essence, a HELOC functions like a second mortgage based on the current value of the home. A HELOC is not the same as a reverse mortgage which requires no repayment of the loan until the sale of the house. Surprisingly even student debt accounts for over one-fifth of household debt for Americans in their 50s. Americans’ penchant for not saving and overspending is sabotaging many a retirement.

It is tempting to want to help a family member (usually adult children) by lending or cosigning a loan for education, a car, or home. However, this action can put you in great financial peril. Let that family member learn their fiscal responsibility rather than putting yours in jeopardy. Younger people have more time to rebound from an adverse economic situation. Those Americans in their 60s and 70s who are already retired and living on fixed incomes can experience crippling life events when carrying unpayable debt.

Remember that buying on credit increases the price of what you purchase. Within the credit card industry people who pay off credit cards in full every month are known as “dead beats.” Why? The lender can’t make any money off of the loan unless your payment is less than the full balance due. The lender makes the most money when you make the minimum payment and the lender can tack on interest to the debt. This is a negative debt cycle for the borrower.

Financial advisers will caution seniors to retire with as little debt as possible. If there is a real need to obtain cash or enter into debt, do not act rashly. Fixes like a payday loan will cost you a lot of money in the long run. It is much better to work with reliable professionals and lenders and create a realistic repayment schedule that works within your budget. If a reasonable loan cannot be struck, then look for ways to avoid needing the loan at all. The best question to ask about going into debt is, “Is this a want, or is this a need?”

We can help you work through how to handle existing or future debt as part of your overall legal plan. It does not take long for debt to pile up and destroy the hopes for a successful retirement.

Contact any one of our six offices today by calling (866) 456-9668 and schedule an appointment to discuss how we can help you with your planning.

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Diminishing brain function due to the onset of dementia can lead to the destruction of your financial well-being. If you are age 50 or older, easy access to your financial assets like stocks and bonds, checking and savings accounts, money market accounts, and other assets can lead to loss of these funds if an unauthorized person gains access to them, or if they are mismanaged. Family members are often unaware their loved one needs help before the unintentionally mismanaged assets, now gone, bring about devastating consequences for both the person living with dementia as well as their family. The Alzheimer’s Association reports that from diagnosis to death, Alzheimer’s disease (AD) care will cost an average of $424,000 per individual, and 70 percent of that cost is out of pocket expenses to the family system of the affected loved one.

It is common to have AD symptoms long before an official medical diagnosis. Difficulty managing money is one of the first signs of Alzheimer’s disease. To spot problems early, look for the warning signs of ill-advised financial transactions through oversight. Unopened or unpaid household bills, overspending on credit cards and making just minimum payments on the debt, falling prey to frauds and scams, and not paying attention to more significant investments that constitute the bulk of a person’s wealth are all indicators of mental decline. As a whole, the situation is very concerning as the poor financial outcomes that asset spending brings about are also happening at a time when expenditures to pay for increasing caregiving needs for dementia becomes extensive.

Projections are that by 2050 , the prevalence of Alzheimer’s will triple in the US. Those individuals suffering from AD who do not have personal or family financial support will most likely become a beneficiary of the US Medicaid program. Total Medicaid spending in the fiscal year 2018 was 593 billion dollars. The federal government paid 62.5 percent, and the states paid 37.5 percent of the budget. Research statistics data from the Centers for Medicare and Medicaid Services (CMS) are projecting that, under current law, from 2018 – 2027 national health spending will be nearly 6 trillion dollars with a substantial portion of that going to underfunded seniors living with dementia.

One of the best ways to protect your finances from the unintended consequence of mismanagement due to cognitive impairment is to accept that this problem exists, and there is a need to put systems in place for financial oversight long before mental decline sets it. Meet with an elder law attorney to put the legal documents in place, allowing for power of attorney, financial control, medical power of attorney, as well as a dementia directive, as early as your 50 ^th
decade. You may also allow a trusted adult family member, friend, or financial advisor to review your monthly spending habits and bill paying.  If there is a noted error in your financial judgment or a lapse in your standard financial operating procedures, they can call it to your attention well before all of your money is gone.

Alzheimer’s Association

According to the Alzheimer’s Association, only 16 percent of seniors regularly receive cognitive assessments in their annual medical exams. Keep yourself from becoming vulnerable by protecting your liquid assets and your net worth with provisions for financial oversight. The safety net you put in place today can protect your finances and even be an indicator that you require testing for cognitive problems. Currently, there is no solution to the problem of Alzheimer’s disease and other forms of dementia however; there are systems you can put in place to protect yourself financially. It is best to prepare for the possibility that you may develop cognitive problems and have protections in place rather than unwittingly put yourself in financial jeopardy.

If you have any questions or need guidance in the financial planning for you or a loved one, please don’t hesitate to contact any of our six offices by calling (866) 456-9668.

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Kiplinger.com is suggesting it is time to rethink your financial retirement portfolio. You may have built up a significant nest egg in a 401(k) plan, but it does come with serious baggage during your golden years. It is impossible to argue against the early stages of a 401(k) when employers match your contribution to the plan. You can take advantage of the tax breaks because contribution money comes out of your paycheck before calculating taxes and that money compounds every year. When you retire, however, the tax impact of a 401(k), 403(b), or traditional IRA can become significant.

You have probably been told at retirement time that you will be in a lower tax bracket however; it is more likely that the opposite will be true. Your tax rate is expected to increase. If you maintain the same standard of living, it will require the same amount of income, which translates to the same tax rate. Additionally, your children will be grown, the house paid off, and those substantial tax deductions are gone which may push you into a higher tax bracket. You will pay taxes on withdrawals from your contribution plan(s) annually irrespective of if the money comes from dividends, capital gains, or your contributions. That money will be taxed at your income tax rate at the time of withdrawal. Currently, the top marginal income tax rate is 37 percent, and taking into account the US deficit that tax rate could increase in time.

Double taxation can eat away at your retirement savings and is often the norm because you can pay more taxes on your Social Security benefits. Unless you have a Roth IRA, distributions from your retirement plans count against your tax situation when calculating what percentage of your Social Security is subject to tax. The result is you are paying more taxes on your retirement plan distributions and Social Security income. You are also paying more taxes from capital gains, dividends, and interest from your investments.

Required minimum distributions (RMDs) can be frustrating and expensive if you neglect to take them. You have to withdraw funds from your retirement fund accounts when the IRS deems it necessary. Even if you want to leave the money in the account, the IRS will schedule your withdrawals when you reach 70 ½ years old. There are stiff penalties for not taking out the required minimum distribution. You may pay as high as an additional 50 percent tax.

If you are married a 401(k) or IRA is the worst account to leave to your surviving spouse. No one wants to die without leaving their spouse financially secure, but these two financial vehicles are fully taxable accounts. Upon your passing, your spouse is about to change tax filing status from married filing jointly to single. That takes your spouse’s tax obligation from the lowest to the highest bracket. Probably not exactly what you had in mind.

Both your 401(k) and IRA plans are subject to tax law changes. Every time Congress convenes a session, there is the possibility that increases in taxes on your retirement plans can occur. It is highly unlikely that your taxes won’t increase. The US debt continues to grow at an alarming rate. The US government will tax its citizens more than ever to gain some level of financial control. Privatize the gains, socialize the losses is the federal government’s rule of thumb, particularly when considering how massive the US debt is.

Get together with a tax planner to identify ways to move your retirement funds into better financial retirement vehicles. Sometimes conversion can cost a bit of money upfront, but in the long run, you will be far better off with regards to your retirement tax obligations.

If you have questions or would like to discuss your personal situation, please don’t hesitate to reach out to any of our six offices by clicking here to send us a message or by calling (866) 456-9668.

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The Senior Safe Act, signed into law by President Trump in 2018, is designed to protect our elders from financial abuse from either within a family or support system, or by scam artists preying upon them. Tens of billions of dollars each year are illegally taken from US seniors and these numbers only reflect the crimes being reported.

SOURCE: North American Securities Administrators Association

Often a senior does not report financial abuse or identity theft because they are unaware, embarrassed, or worse, they think that someone will deem them mentally unfit and they might be “put away” as a consequence of having been exploited.  While these are real issues and fears experienced by elderly people, the scale of financial exploitation is so great it has to be addressed. This is why the enacted Senior Safe Act, coupled with the Elder Abuse Prevention and Prosecution Act (signed into law October 2017), as well as two Financial Industry Regulatory Authority (FINRA) rule changes (which have already taken effect), will provide the legal protections and financial industry framework our senior population need and deserve. One of the most important aspects of the new FINRA rules is the ability for member firms to place a temporary hold on disbursement of funds or securities when there is a reasonable belief that a senior is experiencing financial exploitation, thus protecting assets before they are taken from the senior. This new rule, in conjunction with the Senior Safe Act, can help keep seniors’ assets from vanishing.

The Senior Safe Act, which was originally initiated by Rep. Bruce Poliquin of Maine, is based on the already existing program in that state with the same name. Similar to the Maine program, the federal legislation allows insurance and financial advisors to report incidence of suspected cases of financial fraud involving their senior clients to financial institutions, who in turn could pass the suspicions on to the proper authorities.

As long as the insurance and financial institutions elevate concerns in good faith and their employees have received the proper training, the law will protect the institution and its workers from liability in a civil or administrative proceeding where information had been presented to authorities in the hopes of protecting a senior client from financial abuse or identity theft. The training includes a collaborative effort between state and federal regulators, financial firms and legal organizations, credit unions, broker-dealers, insurance companies and agencies, and investment advisers to educate employees on how to spot and report suspected elder financial abuse.

Seniors who are most active in communicating with a trusted professional third party about their finances are the least likely to fall victim to financial fraud. Counterintuitively, most financial fraud happens to seniors who do not display signs of cognitive impairment. Senior participation with professional and properly trained employees of financial institutions is the back-story of this bill. All of the legal protections of the Senior Safe Act will achieve nothing if there is no participation by seniors.

It is advisable to find a trusted professional adviser to help protect seniors against financial abuse and identity theft. The Senior Safe Act should make it much easier for seniors to find a properly trained individual who will monitor their financial accounts and be able to report signs of potential trouble to authorities. That trusted individual will be able to identify the warning signs of common scams and educate seniors as to how best to protect themselves; such as how often to check credit ratings for signs of identity theft, reviewing financial statements, identifying common phone and online scams, and more. The laws are in place to help seniors stay protected. Get protected by becoming more involved in your own personal financial world.

Contact our office today or call us at (866) 456-9668 and schedule an appointment to discuss how we can help you with your planning and participation.

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