While we frequently plan for our estates considering what we leave to our spouses and children it is probably a fact that we rarely consider the long life ahead either for ourselves or for our spouses as widows or widowers. When we do think of these planning possibilities we generally think in terms of how much do we need to support ourselves comfortably while foregoing regular employment income.
The pandemic made it easier for those contemplating whether retirement should begin now or later to jump in and opt for now. In fact, a recent Forbes article suggested that the current trend referenced as the “Great Resignation” might really largely be a massive move to retirement. See Aviva Wittenberg-Cox, “Is the Great ‘Resignation’ Actually a Mass Retirement?” https://www.forbes.com/sites/avivahwittenbergcox/2021/11/16/the-great-resignationactually-a-mass-retirement/?sh=68457e3c18ba.
Ms. Wittenberg-Cox argues that maybe, to counter this movement, employers should instead more seriously consider taking steps to retain older employees while providing opportunities for them to stay engaged. She notes “The traditional retirement is a move from 100% employed to 100% retired. Overnight.” She suggests alternatively employers could “lex the model and offer older employees a range of flexible employment options that can taper over time…” The implication, although not specifically stated, is that the benefit to employers to retaining experienced workers in some capacity is matched by similar benefits to some retirees in keeping them engaged and also, in some cases, more comfortable with financial uncertainties than the “100% retired” model. Obviously there are huge differences for individuals and for couples regarding retirement with some retirees comfortably fixed and others not so much.
For those who opt for “100% retired” there are some choices to be made.
So what do you do? You make reasonable assumptions and build them into your plan. If conditions change, you change the assumptions. This is what we do all the time with clients.
Finally, without knowing how long you or your spouse will live it can be difficult to know how to plan. For some couples, the goal is to leave a large estate for their children and grandchildren. Others are more concerned to assure they or their surviving spouse has enough. You make decisions that of necessity are based on inadequate information about the future which in some ways has probably always been the case.
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.