Planning for the Future for Your Family

 

This post is courtesy of Alexander Rivera, FA 2020 Wills, Trusts & Estates student at Regent Law:

What is the best way to plan for your family’s future - particularly in the event of your retirement or death? Consider this in both your work life and in your personal life. First, set up a meeting with human resources and go through all of the options that your company offers for retirement/pension plans. Second, meet with your bank or an independent agency to plan your own private retirement account.

Although it is rare among today’s private employers, some employers may allow for pension checks for life which are called life annuities. The employer may also offer a joint and survivor annuity which is for the joint and several lives of the employer and the employee’s spouse. Again, these are rare today but always look to see if your company offers these benefits.

Next, determine if your company offers a 401(k) and at what percentage do they match any contribution that you make into your retirement fund? Once you find out what your company’s policy is on its contribution plan, max your contributions out to take full advantage of that policy. Once you retire you can then choose the payout plan that best suits the circumstances in which you find yourself at that time. Also, make sure you set up a trust or POD (payable-on-death account) to distribute this money to your intended beneficiaries as these types of assets pass outside of probate, avoiding court involvement in your estate.

Regardless of your company’s retirement plan and even if your company does not offer a retirement plan, you should still set up your own personal savings or retirement plan. One interesting way of incorporating what is mentioned above into this plan is to set up a rollover so that when you retire, your contribution plan goes into your personal savings account tax-free. Like the retirement/pension plans above, make sure you set up a trust or POD to distribute this money to your intended beneficiaries because these types of assets pass outside of probate.