It’s that time of year, when New Year’s resolutions and predictions for the coming year are on everyone’s mind. In the article “Top financial planning trends for 2019,” WTOP shared some predictions for 2019.
- Increased longevity means more planning. The Social Security Administration reports that the current average life expectancy for a man reaching age 65 is 84.3. For a woman turning 65, it’s 86.7. According to a World Economic Forum white paper, “We’ll Live to 100—How Can We Afford It?“, the global life expectancy for people born in 2007 is age 103. Are you ready for that? Think about how to best manage your costs and needs, should your live into your nineties.
- Special estate planning tools for second marriages. The financial consequences of a gray divorce can be huge. It’s important to have open and honest conversations about your financial future with a new spouse. Balancing the legacy you leave for your children and building a life with a new spouse can create planning challenges. As both spouses’ separate, especially women, their economic power and wealth increase, the job of protecting their joint and separate assets becomes even more complex.
- Financial technology. Technology continues to be a large presence in managing both administrative and complex financial tasks. This includes things like how we track spending and provide real-time investment data during volatile markets. These tools are a necessity for families that are more geographically dispersed, especially when they’re managing finances for aging parents. Access to digital assets and passwords of aging parents can be a good way to help if they become dependent and need help in administrating assets
- More workforce diversity. Another effect of living longer, is that more people are working longer than prior generations and, in some cases, longer than they anticipated. Couples are also having to consider decisions about when they’ll retire and how to balance the trade-offs of retiring together, versus staggering their retirements over several years.
- Health Care Costs: Health care costs continue to be an ongoing personal and financial concern and need specific planning to address potential catastrophic health cost in later years.
All of these trends for next year have implications for how we choose to work, how long we want to stay in the workforce and how we effectively manage the benefits that we have.
As diversity increases in the workforce, employers see that more differentiation and choice within benefit plans may be needed, to ensure that the benefits offered are meaningful for a wider variety of family circumstances and older workers may need to advocate for different and flexible work benefits.
Every New Year presents possibilities and opportunities. Remember to look before you leap into retirement and long term estate planning, and consider meeting with our firm in combination with a CPA and financial advisor to map out your goals and plans for the coming year and your future retirement years.
Reference: WTOP (December 12, 2018) “Top financial planning trends for 2019”