What’s on Your To Do List?
As we’re heading into September and many of us are getting back to work after vacation, we’re reminded of the piles of mail, home repairs, appointments, bills, and health insurance forms that routinely pile up, all of which create enormous “to-do” lists and impair our abilities to prioritize the important things in life.
Because we’re overburdened with paperwork, too many of us put the important items that we should be prioritizing, items that could be essential to our happiness, on the back burner. As the list of home repairs builds, we essentially diminish the safety of our environment; as our clutter increases, we work less efficiently and make it more difficult for others to help us; and as we fixate on the thousands of dollars we must pay in bills each month, we tend to lose focus on ways to increase our savings and proactively attain financial security.
I once met with a woman who confided that she had a disabled daughter yet she herself had not updated her Will in years. Even after learning that her situation called for a special needs trust for her daughter that did not require any minimum level of wealth but could have been easily funded with life insurance proceeds, she still stated that revising her Will was “on the back burner.” Faced with what was undoubtedly a busy everyday schedule, the woman deprioritized her daughter’s future financial security by not updating her own estate plan.
Planning ahead and tackling the truly big “to-do’s” is critical to maintaining control over financial and health care decisions. It can also help ensure greater physical safety, financial security, organization, and long-term health care. Once the big “to-do’s” are off the back burner and adequately addressed, individuals may even see improved communication among family members.
Anyone over age 18 should execute a Will, Living Will and Power of Attorney. These documents control how financial and health care decisions are handled in the event that the individual signing them is unable to make those decisions due to a temporary or long-term condition. Especially with second marriages, children with special needs, issues surrounding beneficiaries, the documents need to be carefully tailored. Establishing a plan now can help generations later manage money, easily handle an estate of a loved one who has passed away and often save estate taxes.
In addition to establishing an estate plan, the big “to-do list includes financial planning. Individuals should begin saving for retirement early and avoid pulling funds from their retirement savings for reasons other than retirement. If financial planning is done correctly, assets should generate enough income during retirement to meet an individual’s expenses.
For seniors living in their own homes, a big to-do might be engaging a geriatric care manager to conduct a safety inspection in their homes. Dangers often go unnoticed in everyday settings. Also, when everyday tasks become challenging, seniors are best advised to pay for the care they need when they need it. Obtaining a home health aide or other support in the home proactively can help prevent a crisis later and keep the senior at home longer.
Obtaining adequate insurance is another big “to-do.” Life insurance can exponentially increase the amount of assets that will be left to the next generation, and sometimes a policy’s cash value can come in handy when funding education or other expenses during the insured’s lifetime. In addition to life insurance, other forms of insurance that should be addressed are:
Auto Insurance – States all have a minimum level of insurance that residents must purchase.
Homeowner’s Insurance – This protects your biggest asset and is required by mortgage lenders.
General Liability insurance – an “umbrella” policy that will cover liability that is not covered by auto or homeowner’s insurance
Disability insurance – Statistically, as disability is not uncommon, this insurance can protect one’s income during a disability.
Health Insurance – For those below certain income limits, the government now gives a premium subsidy. Keep in mind that while this is necessary for doctor visits, hospitalization and acute illnesses, it does not cover long-term care.
Long-Term Care Insurance – This is the only type of insurance that covers long-term care; today, however, there are many flexible options to help keep premiums down, and also annuities and life-insurance policies with long-term care riders.
Fortunately, many of these big “to-do’s” can be addressed simultaneously, and professionals often cover multiple items on the list. Firms such as Bookbinder Law, LLC may handle estate planning and issues associated with long-term care planning but can also make referrals to financial and insurance professionals.