Financial Tips-Wills and Trusts

Financial Tips from a
Wealth Preservation Attorney’s Perspective:
Part 1 of 2 part series

Often times, my clients ask for my financial advice despite not being a financial advisor. Seniors want an unbiased perspective and unfortunately, commissions make many financial advisors hungry to sell financial products versus assist seniors with their financial needs.
As an estate planning attorney, I have the opportunity to see a wide range of seniors. In my experience, I see several different types of wealth (or senior). The first type of senior is what I describe as a middle-class baby boomer family. Middle-class baby boomers typically begin at age 50 and up and include a husband and wife that have a college education with at least one adult child.
In my experience, this family has a two household income with a nice home Access to credit is vital to this family because they have a modest to high lifestyle. The strength of this family is their hard working ability and commitment to their family. Financial advisors often advise this family to buy more life insurance, increase their 401(k) offerings and savings. Thus, this family has large bills, which threaten their lifestyle upon retirement. My advice to this family is pay off all of your debt including mortgage debt prior to retirement if possible. Clients without any debt are my most financially secure clients. Pay cash for your cars and do not incur additional debt. If you cannot pay cash for the item, then my recommendation is do not buy it.
The second type of senior is a blue collar worker/family person (hereinafter referred to as “blue collar worker”) with a simple lifestyle. Often times, these clients have modest assets with little or no debt. The blue collar worker has lived in the same house for at least twenty (20) years, is married, and has a couple of children.
It is also possible they either live in the suburbs or a rural community. The blue collar worker is a hard worker and loyal. Their house is modest and they have paid off their house.
Due to their modest lifestyle, retirement is easier because their bills are easy to maintain.
Unfortunately, in today’s economy, many of these individuals are unemployed or underemployed. The key with this group is long-term health care insurance. Nursing home care can quickly jeopardize your retirement and family’s standard of living.
Long-term care insurance is a type of insurance designed to cover nursing home or at home care. Despite the high premium, it is absolutely necessary! Seniors are facing health issues and unfortunately, the blue collar worker is too well off to receive Medicaid a/k/a state nursing home assistance. Many seniors are selling their homes to qualify for Medicaid or if they qualify for Medicaid, than Medicaid has a right of reimbursement upon your death. This simply means that Medicaid will recover the amount of expenses incurred by you during your life time and your children will not get an inheritance.
In conclusion, a family’s wealth is measured like a business. A business is profitable only if its’ revenues greatly exceed its’ expenses. The higher your operating expenses such as your household bills, the more difficult it is to make a profit. The key to retirement is lower your expenses while increasing your revenue (or income). In the next Article, we will continue to this discussion.

Sean Robertson is a Wealth Preservation Attorney and Founder of Robertson Law Group, LLC. Robertson Law Group, LLC is based in Naperville, Illinois, a suburb of Chicago. Sean Robertson can be reached at 312-498-6080 or RobertsonLawGroup@gmail.com. Sean Robertson concentrates in Wills and Trusts, Advanced Estate Planning, Elder law, and Asset Protection.