Estate Planning When Nearing Retirement

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Experienced Life Stages Planning Lawyer in Kansas and Missouri: Trusted Advocate For You & Your Family

Retirement is often an exciting yet bittersweet time of life. Chances are good that all your children have left the nest with lives and growing their own families. If your parents are living, perhaps you are taking care of their personal, health care, and financial responsibilities. Now is an excellent time to create (or revisit) your estate plan and ensure your adult children and parents have their legal ducks in a row, too. Using thorough retirement distribution planning in coordination with your financial advisor and CPA, Attorney Kyle Krull can help you prevent issues that can happen when families are not up-to-code with their estate planning (read more in our article What Are the Most Common Estate Planning Mistakes?) Below are four considerations to help you protect your retirement benefits today and prepare for the future.

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1) How do estate planning documents and retirement planning work together?

Unfortunately, many married couples mistakenly believe that they can make personal, health care, and financial decisions for one another should either spouse become legally incapacitated due to a serious injury or illness. Nothing could be further from reality!

Without proper estate planning in advance to appoint your spouse as the incapacity decision-maker, they will not have legal authority to make even fundamental decisions for you (or affecting both of you). For example, medical privacy laws such as HIPPA will bar access to your medical records and the ability to consult with your attending physician, financial laws limit control over your finances, and IRS regulations will prohibit filing a “legal” joint income tax return…for starters.

A probate judge will select one for you unless you legally appoint a decision-maker or medical agent through proper estate planning. While the judge will likely appoint your spouse, the probate court process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record, and is a real hassle for your spouse.

Did you know that in the absence of proper estate planning, your assets, including any retirement benefits, may be distributed after death based on “one-size-fits-all” state laws written for people who do not have their own estate plan? Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets.

In fact, depending on how you titled your assets and how your beneficiary designations are arranged in your estate planning and retirement benefit plans, you may disinherit your own spouse and force your spouse to sue your estate! Fortunately, our legal team employs thorough retirement planning to replace that impersonal, state-written, one-size-fits-all estate plan with one we design together for your unique circumstances and objectives. The Hartford’s ExtraMile blog quotes Attorney Kyle Krull in the article Retiring Soon? What is Estate Planning and Why Does It Matter?, about the importance of creating or updating plans at this life stage.

2) How does the death of one spouse affect retirement planning?

While the death of one spouse is something no married couple wants to think about, the surviving spouse may likely remarry at some point. In a recent University of California study, researchers found that 60% of widowers are involved in a new relationship within two years after losing their wives, while only 20% of widows have a new relationship. Furthermore, according to the U.S. Census Bureau, men are ten times more likely to remarry after age 65. And the average time before they are remarried is just 2.5 years. 

Due to the risks of losing about half of your personal assets or disinheriting your own children and grandchildren should the remarriage not work out, we recommend that individuals who are remarrying create a legally enforceable premarital agreement before saying “I do” on their wedding day as part of thorough retirement planning. As you can see, planning for being single again includes planning for any new relationships in the future while preserving (and protecting) the relationships you already have.

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3) When did you last review your beneficiary designations?

Regarding your children and grandchildren, great care should be given to protect any inheritance for them and from them. For starters, wealth representing a lifetime of your hard work and thrift can be squandered in very short order. Dollars earned are just spent differently than dollars inherited. In addition to good, old-fashioned squandering, an inheritance can quickly vanish through divorces, lawsuits, and bankruptcies.

Lawyer Kyle Krull helps you coordinate the beneficiary designations on your life insurance and retirement plans with your estate plan to avoid unpleasant, unintended consequences. For example, all beneficiary designations for your retirement plans must be revisited, especially due to a U.S. Supreme Court decision on June 12, 2014, (See Clark, et ux v. Rameker).

The Clark case sent shockwaves through the estate planning community after a unanimous court ruled that inherited IRAs are not “retirement funds” within the meaning of federal bankruptcy law. Accordingly, if your children or grandchildren are “direct” designated beneficiaries of your IRA, the distributions may be subject to their divorces, lawsuits, and bankruptcies. Careful planning is required to protect your retirement benefits while at the same time preserving the ability to stretch distributions as long as possible for your beneficiaries. Remember, two things you cannot choose in life are your own parents and the spouses of your children.

4) What is your plan to pay for long-term care, if you need it?

Have you noticed how expensive the continuum of care is? The expenses can destroy savings and investments created over a lifetime of hard work and thrift, from in-home assistance to assisted living to skilled nursing.

Now that you are planning for retirement, do not delay. Lock in a long-term care insurance policy while you can still qualify physically and mentally. Some versions of coverage only pay if you need long-term care assistance, but others can now do double duty and turn into life insurance if you do not require such assistance. That is a popular alternative to traditional long-term care insurance. Disclosure: Gretchen and I obtained our own long-term care policies when we were both age 49.

According to the U.S. Department of Health and Human Services, there is a 70% risk of needing long-term care once you reach age 65. Curiously, most people think they will not be among those needing care (i.e., denial) or believe that Medicare will pay for long-term care expenses (i.e., ignorance)! Our legal team wants to help you make informed planning choices. If you need assistance with the activities of daily living (e.g., eating, bathing, dressing, toileting, and transferring), you may want to hire a professional to take care of you instead of your children. Proper planning will ensure that you both protect your retirement benefits and have set aside funds to pay for long-term care.

Discuss How to Protect Your Retirement Benefits with an Estate Planning Lawyer

We can help you protect everyone you love and everything you have. There are three ways to schedule your complimentary initial consultation: first, give us a call at (913) 353-5114; second, send us an e-mail; or, third, Request an Initial Consultation/Review online.


  • U.S. Department of Health and Human Services: “How Much Care Will You Need?” 
  • U.S. Census Bureau: “Remarriage in the United States: American Community Survey Reports.” 
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