How to Balance Your Retirement with Your Estate Planning Needs

Both for the purposes of planning for your own retirement and longevity and for ensuring that your loved ones receive assets valuable to them once you pass away, it’s a good idea to think about the type of funds you’ll need in retirement.

You’ll need to focus on spending rather than income to determine what’s most appropriate. As you look into your future, it becomes more important to balance your own retirement concerns as they relate to your estate planning goals.

How much have you already saved towards retirement in terms of your current income? You can think of any leftover income today as typical expenses for your current life and this can be used as a baseline for what you might want in retirement. You may be able to reduce your spending habits so start by creating a budget of your expected spending habits.

Costs related to your work will also disappear in retirement, such as childcare, pet care for while you’re in the office, or commuting expenses. However, entering retirement you’ll have other expenses that you don’t currently have today. Out of pocket medical costs and prescription costs will be a bigger concern as will the potential for long term care. A broad rule of thumb that can help you to decide what you’ll personally need for retirement is to multiply your annual spending by 25.

That’s the size that your portfolio would need for you to be in retirement to safely withdraw 4% of that portfolio amount every single year to live on. Remember that you are not limited to gifting at the time of your death alone- you can also leverage annual gifting opportunities to pass on part of your estate now.

For more questions about this process and how to consider it as part of your estate planning, schedule a consultation with a dedicated estate planning lawyer today.

Request A Consultation

  • This field is for validation purposes and should be left unchanged.