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Running Out of Money in Retirement

retirement planning for seniorsRetirement is supposed to be the golden years. However, today the issue of how much money you need in retirement is becoming a much more complex issue. Although it is important to save for retirement, you shouldn’t scrimp and deprive yourself for a retirement that may never happen. The big problem is running out of money while you are retired.

How Much Do I Need?

To start with, you must take into consideration what your financial assets are. Then you must develop a plan that is practical with regard to an individual or family with your assets.

On the other side of the balance sheet you must look into what your income will be in retirement. Do you have annuities? Do you have a pension? Do you have a 401(k) you can draw from? Will your only income be from Social Security benefits and returns on retirement investments?

If your living expenses during the term of your retirement are greater than your income, the only way of making ends meet is to draw down the principal of your savings and investments.

What Type of Investments?

Investing for long term income is the approach you should take with regard to retirement planning. This means you should avoid speculative investments. I suggest that you invest approximately 60-70% of your assets in income producing investments and the balance in dividend paying blue chip stock.

You should not assume that your investments will produce a seven, eight, nine or ten percent return. You should use a very conservative number of either a four or five percent total return on investments.

The Length of Your Retirement

Traditionally, Americans had been retiring between ages sixty and sixty-five. However, with greater life expectancy and smaller amounts of savings, many Americans are considering retiring at much older ages. If you retire at sixty-five you must take into consideration that you have enough assets to last you twenty-five or thirty years. However, if you retire at an older age, the term of your retirement will be shorter and the length of the payout in your investments will be shorter.

Investment Scams

There are tricksters and scam artists who prey on senior citizens. Be careful with regard to investment advisors who promise high investment returns. If you are not sophisticated with regard to investments, you should find a well thought of investment advisor to help you. You should counterbalance the suggestions from your investment advisor with a certified public accountant.

Investing for retirement can be difficult. Hopefully you will be successful in accumulating enough money and investing it properly to actually have those golden years in retirement.

assistance in elder care planningElliot S. Schlissel is a member of the National Academy of Elder Law Attorneys. He assists his clients in all types of elder care issues related to medicaid planning, drafting wills and assisting the clients and their family members regarding probating of wills.

President Obama Orders the Creation of New Retirement Accounts

elder law attorneyOn Wednesday, January 29, 2014, President Obama gave his State of the Union address. During the course of his address, he ordered that a new type of employer sponsored saving account be created for the purpose of helping people save for retirement. The President suggested creating this new class of retirement saving account would help middle class Americans bridge the growing income equality gap.

Starter Retirement Savings Program

The new saving program created by President Obama is called the “MyRA”. The name mimics the Individual Retirement Account (IRAs) that first came into existence to help Americans save for retirement in the 1970s. These new accounts operate similar to the Roth Individual Retirement Accounts (Roth IRAs). Married couples with adjusted gross incomes of up to $191,000 and individuals with incomes up to $129,000 will be able to put away $15,000 in after tax dollars for a maximum of 30 years.

Currently the Roth IRAs will allow working individuals to save up to $5,500 per year, or if they are over 50 in 2014 $6,500 per year. Contributions can be withdrawn tax free.

The MyRA funds are subject to being withdrawn at any time without paying an income tax penalty. However, if the money is removed from the MyRA said funds will be subject to the same restrictions that currently exist for Roth IRAs.

Investment Options for the MyRA

There will only be one investment option for the MyRA. The United States Treasury is going to create a security fund modeled after the Federal Employees Thrift Savings Plan Government Securities Fund. This fund will have a variable rate of interest return on the funds deposited in it. This will prevent any individuals making deposits in the MyRA avoid losing any money maintained in this retirement plan.

The purpose of the MyRA is to allow lower income Americans to accumulate up to $15,000 towards retirement. Although this is not a significant amount of retirement assets, it is a start in the right direction.

estate planning assistanceElliot S. Schlissel is a member of the National Academy of Elder Law Attorneys. He drafts wills and trusts and handles estate and probate matters for clients.

Foreclosure Action Stopped by Death

Nettie Francis had executed a mortgage. The holder of the mortgage brought a foreclosure lawsuit against her. In May of 2010, the court had declined to sign a proposed judgement of foreclosure and sale. The court took this action because there had not been a submission of an order showing the mandatory residential foreclosure court conference had been held in the case.

Husband Seeks to be Named Administrator of Wife’s Estate

In July 2010, Nettie died. Nettie’s husband brought an action to intervene in the case. In this proceeding he submitted, to the court, a death certificate proving Nettie died in July 2010. His paperwork also showed since her death he had been taking care of the home. He indicated in his motion he was in the process of bringing an application in the Surrogate’s Court to be appointed the administrator of Nettie’s estate. He brought this action as an intervenor to be named a defendant in the foreclosure lawsuit.

Counsel for the financial institution argued against Nettie’s husband being allowed to intervene in the lawsuit. He claimed this application didn’t set forth a claim or defense for which the intervention in the suit was sought. He also claimed the motion being made by the husband was not made in a timely basis.

Supreme Court Justice Robert McDonald sitting in Queens County held the death of a party divested the court of jurisdiction. Upon Nettie’s death the proceedings were automatically stayed. The proceedings could not proceed without the substitution of a personal representative or an executor for the deceased party.foreclosure advocate

Reverse Mortgages

estate planning attorneyA reverse mortgage is a means by which seniors utilize the equity in their homes. The equity is turned into cash. It can be used to supplement social security, pension payments, and 401K plan withdrawals. In most situations, the proceeds of a reverse mortgage are taken out in a lump sum. Arrangements can be made to have periodic payments over the period of your life, too.

The big benefit of a reverse mortgage is you don’t have to repay it during your lifetime. It gets repaid upon your death. The drawback of a reverse mortgage is it tends to have a higher interest rate than conventional mortgages. In addition to interest payments and an annual insurance charge, the Department of Housing and Urban Development’s home equity conversion reverse mortgage program level an initial one time insurance premium from 2% to .01% on your home’s value. It should be noted as with any mortgage, there will be closing costs regarding reverse mortgages.

New York Estate Planning Lawyers

Whether you take out a reverse mortgage or not is a complicated question. You should meet with an estate planning attorney. Discuss your finances and the consequences of a reverse mortgage before proceeding to take one out.assistance in planning for retirement

Retirement Financial Pitfalls

Planning for retirement is difficult.  Today, nest eggs are much smaller than they have been in the past.  Many individuals and families plan for retirement at the last minute.  This can cause problems.

Save And Invest

Americans need to save today, not tomorrow.  It takes a lot of will power to forego today’s pleasures and have money for the long run.

Retirement Is Not A Permanent Vacation

Some TV advertisements present retirement as a permanent vacation.  You see pictures of individuals playing golf in a Shangri-La type atmosphere.  Americans are living longer today.  The Shangri-La atmosphere presented in those pictures can become boring and stale.  Even if you can afford living in a retirement community of that type, life expectancy can stretch retirement for as long as thirty or forty years.

Unanticipated Expenses

A Study by Fidelity Investments indicates a couple who are 65 years of age when they retire will need more than $250,000 to pay for medical expenses throughout their retirement.  These medical expenses do not include nursing home care.  The study found the average medical expenses for a 65 year old couple amounted to more than $530 per month.  It should be noted Medicare is not free and doesn’t cover all medical expenses!

Be Careful With Your 401K Plan

A 401K Plan is retirement plan.  Many people borrow large sums from their 401k plans and are not able to pay these sums back. Depleting your 401K plan can have a significantly negative impact on your ability to retire.

Be Careful Of Your Priorities

Steven Cuhna, a certified financial planner with Bay Street Financial Services, suggests you remember the 5 P’s regarding retirement,  Prior Planning Prevents Poor Performance.  You should have a plan that analyzes your financial goals, retirement needs, investment and estate plan.  You may live a long time but you will not live forever.  Having a will and/or irrevocable trust may be necessary to help you preserve your assets.  Another solution is to never stop working!

Guardian Allowed To Help His Ward Prepare A Will

Justice Alexander W. Hunter sitting in the Supreme Court, Bronx County recently had an unusual case presented to him.  A daughter brought a proceeding in a guardianship.  She requested the court take action to prevent a court appointed guardian from retaining an attorney to draft and execute a new Last Will and Testament for her father.  She took this action because she felt the drafting of this new Will would not be in the father’s best interest.

Justice Alexander Hunter denied her request.  In his decision he stated that her arguments were a regurgitation of allegations she made in her initial petition to be appointed the father’s guardian.  The court had initially found that the father required the appointment of a guardian of both his person and property.  But the court’s decision stated that the court evaluator believed that the guardian should keep the father involved in the decision making processes.  He also stated in his decision that the guardian should give the father the greatest amount of independence and self determination with regard to his property management and the maintaining of his personal needs.  The court felt that the father’s drafting a new Will and Testament possibly “opened the door to potentially costly and protracted litigation post mortem as being speculative.”

Guardianship Lawyers

The Law Offices of Schlissel DeCorpo have over 100 years experience in the preparation and submission of guardianships to the courts to the courts throughout the metropolitan area.  There are two types of guardianships under Article 81 of the New York Mental hygiene Law and Guardians under the Surrogates Court Procedure Act under Article 17-A.  The Law Offices of Schlissel DeCorpo have extensive experience in handling all aspects of Guardianship petitions on a regular basis in the courts throughout the metropolitan New York area.  In addition our law office drafts Wills and Trusts and probates Wills.  We assist our clients in Estate Planning matters.  We represent Executors in Estates.  We also draft Revocable Living Trusts, Irrevocable Living Trusts and engage in all aspects of Medicaid Planning.  In situations involving Special Needs children we draft Special Needs Trusts which are also known as Supplementary Needs Trusts.

Estate Planning Problems: Computer Codes

estateplanning-150x150

Computers codes are the new frontier concerning Estate Planning issues. Should a senior become disabled, uncommunicative or die, access to his or her online accounts are creating major estate planning problems. Without the password to an online account it is virtually impossible to get into the account. Yahoo and Google will only provide passwords if court orders are obtained.

It used to be if someone became disabled or died you would go through their papers or review their mail to ascertain where their assets were maintained. Today, most Americans maintain their assets in online accounts that are only accessible by user codes and passwords.

Court Orders

If it should become necessary to obtain a court order to obtain the passwords to an account of the deceased, it may take months to get the proceeding through the courts. If there are no written records, family members and loved ones will be unable to obtain information from the bank account of seniors who become disabled or have passed away.

Hiring Computer Forensic Experts

If you need to get into the account of a loved one and you do not have access to his or her account name and/or password it may become necessary to hire a computer forensics expert to break into the hard drive to find the necessary information. This can take weeks and involve a considerable expense.

Inventory of Computer Codes

John Ramano, the co- author of “Your Digital Afterlife” suggests that each individual write out an inventory of financial online assets. This inventory should include usernames and the passwords that go with each username. He recommends these computer codes be maintained in a secure location such as home safe or a bank safety deposit box.

Web Based Companies

Another approach is to maintain the services of web based organizations that store information concerning online assets. The organizations such as Entrustet and Legacy Locker will permit access to this web based information to authorized individuals.

There is a program call Last Pass. This allows an individual doing an estate plan to create a master password. The unlocking of this master password by an authorized representative or family member opens up a digital asset list which is created by utilization of the Last Pass software program. This software can also be accessed by handheld electronic devices such as telephones, personal computers and iPads.

Estates Attorney

The Law Offices of Schlissel DeCorpo has more than thirty years of experience in handling all types of Estate related matters. We probate Wills. We litigate Will contests. We draft Wills and Trusts. We create guardianships for clients. We have developed expertise concerning Estate Tax issues, Revocable Living Trusts, Irrevocable Trusts, Elder Care issues, nursing home abuse matters, Medicaid, Medicaid planning techniques, Special Needs Trusts and Supplement Needs Trusts for our clients. Call us for a free consultation. Our phones are monitored 24/7. We can be reached at 1-800-344-6431, 516-561-6645 or 718-350-2802.

Why You Need A Living Will

willspic-150x150End of life issues are difficult to face. Everyone that lives will eventually die. If you want to make your own choices as to how you’re cared for, should you become gravely ill, it is important that you have a Living Will. A Living Will is an advance directive that explains to your loved ones and your physicians what type of life prolonging medical treatments you want and don’t want if you become incapacitated, are placed on a resperator, or are unable to express your concerns due to illness or injuries.

End of Life Issues on Long Island

Long Island (Nassau and Suffolk Counties) in the State of New York, is considered a ” high spending” medicare area of the country. Most individuals without health care proxies on Long Island will find themselves dying in a hospital. Individuals with Living Wills can choose to spend their final days in a hospice facility.

Hospice Facilities Verses Hospitals

Hospice Facilities are designed to make patients facing end of life diseases comfortable by treating their pain and allowing their illnesses to run a natural course. Treatment in hospitals is organized around the theory of prolonging life. This can involve aggressive procedures even if the illness is considered by the treating physicians to be terminal. The treatment in hospitals for terminal illnesses can greatly reduce the quality of the individuals life. Sometimes the difference between hospice care and hospital care relates to the quality of the individual’s life while dealing with a terminal illness.

Living Wills and Family Members

Lauren Hersh Nicholas is a health professor with the University of Michigan. She has conducted a study of involving living wills. She states there’s a benefit to the family of the patient. “Family members have a somewhat easier decision making process, because they have greater guidance.” The hospice treatment can eliminate pain and reduce medical procedures that are unlikely to work.

Elder Law Attorneys

The Elder Law and Wills, Trusts and Estate lawyers at the Law Offices of Schlissel DeCorpo have been helping their clients deal with end of life issues for more than 3 decades. The law firm drafts Wills, Trusts and Health Care Proxies, Powers of Attorney and Living Wills. They represent individuals involved in will contests. They explain to executors of wills their duties. In addition, they draft revocable living trust and irrevocable living trusts. The firm is also involved in assisting clients with nursing home issues as well as medicaid planning technigues. Call for a consultation at 1-800-344-6431, 516-561-6645 and 718-350-2802.

Why Create An Irrevocable Trust?

make_money_online_blogging-150x150Irrevocable trusts cannot be changed. They are permanent trusts.

Asset Protection: When you place your assets in irrevocable trust, you remove ownership and control of those assets from the creator of the trust. These types of trusts are used for Medicaid planning purposes. It should be noted that there is a five year look-back period for medicaid eligibility. The assets placed in these trusts cannot be reached by creditors of the individual who made the trust. One type of irrevocable trust is called a self-settled irrevocable trust.

Life Insurance: Another type of irrevocable trust is called an irrevocable life insurance trust. If you purchase life insurance and transfer the policy into an irrevocable life insurance trust, the proceeds of the life insurance pass outside of your estate. They therefore are not taxed as part of your estate.

Tax Purposes: You can also create an “AB trust” for the benefit of your surviving spouse. This type of trust allows you to use the spouse’s exemption from estate taxes by funding the “B” trust with assets valued at or below the federal estate tax exemption rate, in the event the value of the deceased spouses estate assets is greater than the estate tax exemption at the existence of time of death. The “A” trust would be funded for the benefit of the surviving spouse. Estate taxes in this situation are deferred until after the surviving spouse dies.

Should you have questions regarding irrevocable trust contact the trust attorneys at the Law Offices of Schlissel DeCorpo by email or at 1-800-344-6431.

Trustees: Who are They and What do They do?

trust-administration-attorney-300x199A trustee is the person who administers a trust. A trust can have one trustee, two trustees, or multiple trustees.

In theory the trustee is the owner of the trust assets. Trustees supervise the disposition of the trusts assets. They handle investments and, in some types of trusts, they make periodic payments to beneficiaries. Trustees must produce accountings on an annual basis to give the beneficiaries an opportunity to see how the trust is being administrated. The trustee is responsible for filing income tax returns with the Internal Revenue Service and, if there is an estate income tax, with estate taxing authorities on behalf of the trust. Sometimes trustees are given discretionary authority to make dispositions of trust assets to the trust beneficiaries.

In New York the trustee is a fiduciary held to the highest standard of ethical conduct.

Trustees are paid a commission in the State of New York based on the value of the trust assets they administer.

Beneficiaries of a trust receive periodic payments from the trust. The term and nature of the periodic payments are dealt with at the time of the creation of the trust. The individual who creates the trust is called the trustor or settlor. Individuals who receive the balance, if any, of the assets of the trust at the end of the operational period for the trust are called remaindermen.

Should you have questions regarding trust issues contact the trust attorneys by email or at the Law Offices of Schlissel DeCorpo at 1-800-344-6431.

Valley Stream, Lynbrook, Baldwin, Malverne, Freeport, Oceanside, Long Beach, Elmont, Lakeview, West Hempstead, Hempstead, Merrick, Bellmore

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