Legacy and Advanced Planning

Jun 2, 2023 | Retirement Planning

If you are a federal employee about to embark on the next chapter of your life in retirement, it is a good idea to have a solid understanding of estate planning. This includes establishing a will, trust, and directives to help ensure that your assets are distributed according to your wishes. It can provide clarity for your family and loved ones during challenging times. Let’s explore what federal employees should know about wills and trusts when preparing for retirement. We’ll also outline a few directives and the different types available.

The Importance of Estate Planning

Estate planning is a process that enables individuals to protect their assets and determine how they will be managed after their passing. It provides a sense of security not only for the retiree but also for their loved ones, by ensuring a smooth and organized transfer of wealth. Federal employees, like any other individuals, should be aware of key estate planning tools to safeguard their assets and honor their legacy effectively.

Wills—The Cornerstone of Estate Planning

A will is a legal document that outlines an individual’s wishes regarding the distribution of their assets upon their death. It allows federal employees to designate beneficiaries, appoint an executor, and specify their preferences for guardianship if they have minor children. Without a valid will, the distribution of assets will be subject to state laws, which may not align with the retiree’s intentions. Creating a will is vital in ensuring that your estate is distributed according to your desires.

Trusts—Preserving Assets and Minimizing Probate

Trusts are another tool in estate planning, particularly for federal employees seeking to safeguard their assets and streamline the distribution process. A trust is a legal entity that holds and manages assets on behalf of beneficiaries, known as trust beneficiaries. By transferring assets to a trust, federal employees can avoid probate, a potentially time-consuming and expensive legal process, and maintain privacy since trusts are not publicly disclosed like wills. Trusts also offer flexibility in managing assets during one’s life and can be customized to meet specific needs, such as caring for minor children, providing for special needs beneficiaries, or preserving wealth for future generations.

Directives—Ensuring Personal Health and Financial Decision-Making

In addition to wills and trusts, federal employees should be aware of directives, also known as advance directives or powers of attorney. These legal documents empower individuals to appoint trusted individuals to make important decisions on their behalf if they become incapacitated and are unable to make choices regarding healthcare or finances.

There are different types of directives that federal employees should consider.

  • General Durable Power of Attorney for Finances: This document designates an agent to manage financial affairs, such as paying bills, managing investments, selling property, and managing digital property in the event of incapacitation.
  • Medical Power of Attorney: This directive allows individuals to appoint someone as a healthcare proxy to make medical decisions on their behalf when they are unable to do so.
  • Living Will: A living will outlines an individual’s preferences for end-of-life medical care, such as life-sustaining treatments or palliative care, ensuring that their wishes are respected. A dementia directive supplements a living will, advising your preferences if you have dementia and can’t speak for yourself.

By considering and executing these directives, you can help ensure that your personal and financial matters are managed according to your wishes, even if they are unable to express them directly.

Looking for more guidance? We can help!

If you are looking for a guide through the retirement process and to put together a financial plan, Benchmark Financial Group will help. It all starts with gathering your information, discussing your goals, and preparing a plan so that we can help you maximize your income in retirement. With the right strategy, you may be able to get your income equal to or exceed your pre-retirement net income. To get started, schedule an appointment today with Benchmark Financial Group by filling out the form online or calling David Raetz at 913-534-8256 to discuss your financial needs. Benchmark Financial Group is happy to help you navigate your options and determine the best path to move toward your financial goals.

*Securities and Advisory Services Offered Through CreativeOne Securities, LLC  Member FINRA/SIPC and an Investment Advisor.  Benchmark Financial Group, LLC and CreativeOne Securities, LLC are not affiliated.

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