CONSIDER RETIREMENT FUNDS IN ESTATE PLANS

Many Florida residents who are preparing for their estate distribution do not realize that their spouse might lose out on retirement money when the other person passes away. This important estate valuation information should be considered before estate planning is finalized.

Couples need to realize that the death of one spouse could spell financial disaster for the surviving partner if a plan is not in place. For example, if both spouses are receiving benefits from Social Security, the death of one partner could seriously impact the income provided to the surviving spouse. Furthermore, it is important to realize that survivor benefits rarely make up for the discrepancy in lost income, according to financial planners.

Furthermore, pension benefits can be reduced if both spouses have not enrolled in the joint-and-survivor annuity. If the annuity is based on the life span of one person, and that individual dies, that money will dry up. Conversely, by using the joint-and-survivor annuity, couples can ensure that the surviving spouse will still receive money. It is highly suggested to sign up for the joint-and-100-percent-survivor annuity to prevent income drops.

One financial planner cited a client, whose income dropped by 35 percent, while expenses only were reduced by 10 percent. A big change in cash flow can compromise the standard of living you have worked so hard to maintain.

For this reason, it is critical for Miami residents to closely evaluate their pensions, retirement plans and Social Security setups to guarantee continued benefits for a surviving spouse.

Share this on...Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Email this to someone

Written by Luis E. Barreto

Luis E. Barreto

Luis is a probate and guardianship litigator with over 23 years of experience in the field. Determination of heirs, will contests, breaches of fiduciary duty, removal of personal representatives, guardians and trustees are just some of the types of litigation he addresses. In addition, he administers non-contested estates and guardianships.