Marsha/CA said:
Your advice to make financial plans as we go towards the final lap, as you say, is very good; and I totally agree, I don't think many people do any preparing. For one thing, like you mention, it's hard to talk about. My husband and I have a trust with medical directives, powers of attorney and a will. (We never talked about this with our parents.) For me, I didn't want my sons to have to wade through all the mess of figuring things out. They each have a 3 ring notebook with copies of everything we have done. However, they really don't want to talk about any of it or even know about it. (BTW, this discussion reminds me my husband and I need to go over everything to see if it's up to date).
I have an older uncle that just isn't taking care of things. He has no children, never married and his wealth is close to 3 milliion dollars. He has no trust, no will and no plans other than he wants it all to go to the University of Alabama. Now I don't care if UofA gets it all; but they are gonna get a lot less if it all goes through probate and it will be tied up for years. The state of Alabama will be making some $$$ on him. I've talked to him about setting up a trust, making plans etc; but he is dragging his feet. He says "ya...ya...I'll get it done and you can be the executor". Well, he isn't doing anything about it and I'll probably get a call and have mess to deal with.
Back on to the planning part, I had heard that 75% of the baby boomers have no more than $75,000 saved for retirement which included 401s and retirement plans.
Marsha~
It's only hard to talk about if we let it.
Waiting until it is too late to take care of our final arrangements is not very smart. It saddles our loved ones with some very difficult decisions at just the time they are least capable of reasoned coherent thought. This is a very bad idea and I am glad to see that you and others here have handled the situation well before it turns into a disaster. A review of your plans from time to time is also an excellent idea. Something that seemed real good 4-5 years ago may not seem so good now.
I'm VERY concerned about your uncle. If he dies intestate, the laws of his state of residence, and not him, will determine where his estate goes. A good part of that WILL be absorbed by courts and lawyers. His desire to donate to the university will not be realized, as they have no legal standing to participate in his probate. Only living relatives, creditors, and those specifically mentioned in a will can do that. You can believe that the fight will be on to see who gets what and how much. Nothing brings out the fangs and claws faster than a will in probate. I think that you should ask him rather point blank if he really wants to leave money to the university or not because if he does not take positive action to ensure this, it will NOT happen. It may be that you need to have a will and the other documents he needs done so all he needs to do is read them over and sign them. Yes, this is being somewhat intrusive but if you don't act to ensure his wishes who will? He certainly isn't doing anything about it and death never makes an appointment. He just shows up whenever he wants and we never know when that will be.
My 84 year old parents told me last year that while I had a lot of good ideas about estate planning, they would "take care of it in our own good time". I asked them, "Just how much time do you think you have for this?". They were a little startled but didn't say much. Three months later, my Mom got pneumonia while on a trip to CA and almost died. WAKE UP CALL! HELLO!! A few weeks later, they were suddenly VERY interested in estate planning. We got their will and trust written up, signed, witnessed, and notarized. Whew!
Yes, most of the BB generation is woefully under-capitalized as far as retirement goes. I worked long and hard to plan, save, and invest for retirement. A critical element in my planning was what would happen to us if SS were not available. At times, I probably put more into it than I should have. A lot was sacrificed. I never got that boat I wanted, for example, and DW never got the beach cottage she wanted. We are well funded for retirement now, however, and that is what counts more than having had a string of toys that would by now surely be sold, broken, or forgotten. Our remaining mortgage is small, our home equity large (because we never borrowed it out and spent it), and retired life is good.
Ed