Planning for retirement can be a daunting task. Among the questions that every New Jersey resident should answer are: How much money will I need and how long will I need it for? At first glance, the answers seem hidden in a maze of probabilities and guesses. If pressed for an answer, a person may respond: I hope to live a long time, so I will probably need a lot.
But there are ways to tease out relatively accurate answers to these questions and, importantly, to plan for the numbers they churn out. As regards life expectancy, actuarial surveys can provide an estimate of a person's life span, with some margin of error, based upon such measurements as health statistics, diet, family history and satisfaction with life. Using that number, an elder law plan can develop a course of action that seeks to protect assets while ensuring that a person has enough funds to cover medical bills and other costs that come up in retirement.
Factoring in the cost of health care is particularly important. While rapid evolutions in medicine allow us to live longer than ever, marked jumps in hospital costs mean that these life-preserving treatments can ironically deal a fatal blow to a person's checkbook.
People in or on the threshold of retirement should therefore consider various mechanisms for ensuring that they have the funds to match and exceed their life expectancy. Drawing on a mixture of legal and financial acumen, these mechanisms can include Medicaid planning and long term care insurance. One size does not always fit all, however, so it is important that people create an elder law plan tailored to their individual circumstances.
Source: CBS Money Watch, "How long will you live?" Steve Vernon, June 26, 2012.