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Updated: September 25, 2023

How to financially prepare for the next chapter

Kate Wilkinson Courtesy / Spinnaker Trust Kate Wilkinson, Spinnaker Trust

As good as these years are, the seventh, eighth and ninth decades of life can be a confusing time.

There are so many factors you can’t control and can’t predict, whether you’re contending with health challenges, caring for a loved one, trying to figure out what kind of setting you’d like to live in or trying to anticipate what kinds of services you’ll need and what they’ll cost.

Luckily, there are plenty of steps that you can take to ensure that you are financially prepared for whatever challenges may be ahead.

Get your paperwork in place

It goes without saying that it’s important to have an up-to-date estate plan that details how you would like your assets to be distributed after your death, as well as a living will that spells out what medical care you do (and don’t) want to keep you alive.

It’s a good idea to also designate someone trusted to have health care power of attorney, who is authorized to make decisions about your medical care in case you are not physically or mentally able to do so.

It’s also important to designate a person to have financial power of attorney who has the authority to act on your behalf about your money matters in case you cannot. Work with an estate planner to draw up these documents up and have them notarized.

Consider your short-term cash needs and tax liabilities

If you’re planning to sell your home, you’ll have a myriad of expenses that go along with making that transition. You may need to budget for light renovations to get your home market ready.

In addition to setting aside money for moving, you may want to hire a downsizing specialist to help you sort through furniture and treasured belongings. There may be significant expenses for long-term storage, or shipping furniture to far-flung loved ones. And if you’re moving into a retirement community, you’ll need to think about what kinds of initiation fees and monthly expenses you’ll need to account for. In general, it’s a good idea to have six to 12 months of living expenses that are readily available.  

Don’t try to DIY

There are plenty of tools and free resources online, but it’s important to work with a team of trusted financial and legal advisors who can help you devise a plan based on your unique needs and circumstances.

Those advisors can help you determine how to allocate your assets to ensure that you have enough money to cover everyday living expenses and maintain the lifestyle you aspire to lead in the years ahead, without worrying about outliving your financial resources. It’s a good idea to introduce your family members to that team so that they’re not meeting one another for the first time during a crisis.

Start before you want to

Because this stage of life involves lots of difficult decisions and uncomfortable conversations, many people delay tackling them until they are forced to do so by an illness, an injury, or some other emergency.

Unfortunately, at that point options become limited.

Get your financial matters settled while you are healthy and clear about what you want. The sooner you do, the sooner you can just focus on enjoying your life now. 

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