Despite American couples generally agreeing on financial management and trusting each other’s financial behaviors, recent research highlights a lack of estate planning. Studies emphasize that only a third of U.S adults have a will or other estate planning documents. This lack of preparation can lead to complications and potential disagreements among survivors when a loved one passes.
Failure to formalize an estate plan, even with mutual trust and agreement between partners, can result in unexpected outcomes. Experts often advise taking the necessary step of creating an estate plan to ensure distribution of assets as per wishes and minimize any stress on loved ones.
A recent study analyzed data from over 1,500 American couples aged 45 to 70 with at least $100,000 in investable assets. Their financial behavior and strategies both prior to and post-retirement were examined. Findings suggest many of these financially stable couples were unprepared for unexpected costs or economic downturns. The study showcased a critical need for more comprehensive financial planning among pre-retirement and retired Americans.
Despite agreeing on retirement goals and timing, couples had differences on crucial estate planning decisions. Disparities highlighted a need for increased communication and financial planning between couples, especially regarding retirement and estate management.
Underprepared: Estate planning in American couples
Close to 76% of couples still managed to agree on other financial decisions, demonstrating that agreement on all financial matters is not entirely impossible and could be achieved with better financial communication and joint planning.
The study showed a significant gap between the awareness and actual implementation of estate plans: more than half of the couples acknowledged not having an established estate plan. This lack in preparation can lead to future complications. Despite such risks, the majority have not yet taken steps to prepare suitable estate plan. There is a pressing need to stress the necessity of adequate planning for retirement and distribution of assets.
Marcy Keckler, a finance corporation official, encouraged couples not to shy away from estate planning. She suggested that every estate, irrespective of its size, can benefit from appropriate planning and updates as the financial situation changes. She emphasized the importance of seeking professional advice and consulting with attorneys, accountants or financial advisors. Keckler believes thorough planning can secure financial futures and create lasting legacies.
Keckler stressed the peace of mind that comes with finalized estate plan, advising careful storage of documents and providing copies to healthcare providers. She also highlighted the importance of regular communication with executors and trustees and seeking professional legal advice when making an estate plan.
