Wealth Management and Risk Mitigation
Investment Planning
Retirement Planning
FAQ
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Will or Trust?
For many Massachusetts families, the question is not "Will or Trust?" but rather "What combination of tools best accomplishes my goals?" Even when a trust is used, a will is typically still part of the overall estate plan.
A financial advisor and estate planning attorney can work together to help ensure your estate plan aligns with your financial plan, beneficiary designations, tax strategies, and family objectives. An estate attorney creates the structure. A financial advisor makes the structure financially efficient, tax-aware, and operationally correct.
A will is a document that contains your direct wishes for your property and assets, as well as the care of your dependents. Failure to prepare a will typically leaves decisions about your estate in the hands of judges or state officials and may also cause family strife.
A will allows you to:
- Specify who receives your assets
- Name guardians for minor children
- Appoint an executor to manage your estate
- Provide instructions for final wishes
Massachusetts probate is often manageable for simple estates, and some assets—such as retirement accounts, life insurance, and jointly owned property—may pass outside probate automatically.
Probate is the court-supervised process for transferring assets after death. While probate works as intended in many cases, some families prefer to avoid it because it can create additional costs, delays, and administrative burdens.
A will that goes through probate becomes part of the public record.
A trust is a fiduciary relationship in which a grantor gives a trustee the authority to hold assets for the benefit of one or more beneficiaries. By law, trustees must disperse these assets following the grantor's instructions.A trust is generally employed to hold assets so that they are safe from creditors, or others that may lay claim after the grantor’s death. Trusts are also used to keep assets safe from family members who might otherwise sell or spend them.
A trust can offer benefits, including:
- Avoiding probate for assets held in the trust
- Maintaining privacy, since trusts are generally not public records
- Providing management of assets if you become incapacitated
- Controlling how and when beneficiaries receive inheritances
- Helping protect assets for children, beneficiaries with special needs, or blended families
Which is Right for You?
A will may be sufficient if:
- Your estate is relatively straightforward
- You have limited assets
- You are comfortable with the probate process
Consider a trust if:
- You own real estate
- You want to avoid probate
- You have significant assets
- You have a blended family
- You want greater control over how assets are distributed
- You are concerns about privacy or incapacity planning
- You wish to protect your legacy for future generations
Bottom line: A will is essential for most adults. A trust can provide additional flexibility, control, and probate avoidance benefits. The right choice depends on your goals, the complexity of your estate, and how you want your assets handled.
Consulting with legal and financial advisors experienced in estate planning is crucial to ensure that the trust structure aligns with the grantor's objectives and complies with relevant laws and regulations.
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What is the best strategy for Social Security?
There is no universal “right age” to claim benefits. The optimal strategy depends on
several personal and financial factors, including your cash flow needs, health and family
longevity, marital status (married, divorced, or widowed), and the availability of other
income sources. The performance of your investments and your plans for continued
work also play a critical role.
Understanding the rules is essential. Once you reach full retirement age, you may work
and earn unlimited income without any reduction to your Social Security benefit.
However, claiming benefits before full retirement age while continuing to work can result
in a temporary reduction due to the earnings test.
Because Social Security provides lifetime, inflation-adjusted income, the decision of
when and how to claim should be approached strategically. For most retirees, it is one
of the most consequential financial decisions they will make, and careful analysis can
materially improve long-term retirement security.
We can help calculate your benefit at different claiming ages, identify your break-even
points, and model multiple scenarios to evaluate the trade-offs. A personalized Social
Security analysis can help you make a confident, informed decision that supports your
broader retirement plan. If you are approaching retirement or already receiving benefits,
now is the time to review your strategy and ensure it is aligned with your long-term
financial goals.
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5 Major Retirement Regrets (That Are NOT Inevitable & How to Avoid Them)
When are you going to retire?
How did you make that decision?
Many of us look at finances and health when we’re deciding when to retire.
Whether or not we realize it, we’re also considering our emotions and what we imagine for the future — we compare how we feel in our current circumstances to how we expect to feel in our anticipated retirement.1
With that, we tend to overestimate our future emotions, thinking we’ll be a lot happier as retirees.1
And that can motivate short-sighted decisions that lead to more regrets than satisfaction in retirement.1
To avoid that and make better decisions about retiring, let’s look at some of the leading retiree regrets, what’s behind them, and what you can do now to set yourself up for a dream retirement later.
Retirement Regret #1. Retiring Too Early
Retiring as soon as possible can be a priority, but retiring too early can be a big mistake. For one, premature retirement can mean gambling with your financial security in the future. If you leave work too early, you could be forfeiting some key, higher-earning years to build up your savings.
Beyond that, retiring too early can turn the page on your social life or drain a sense of purpose if you’re not prepared for the next stage.
Pro Tip: If retiring early is a goal, consider a phased retirement that lets you work part-time while you transition into retired life. A phased approach could let you continue to earn income, stay connected to your social life, and wade into retirement (instead of taking an instant plunge).
Retirement Regret #2. Sidelining Retirement Plans for Too Long
Retirement planning can stall when we think we have years or even decades to put plans in place. Unfortunately, the longer you wait to start retirement planning, the more challenging it can be to build the nest egg you may need.
That, in turn, could leave you with less retirement savings and far less flexibility later. It may also mean that you have to make more tradeoffs and more difficult decisions later, like foregoing certain luxuries or bucket-list adventures.
Pro Tip: No matter how old you are now, start planning for retirement. Your strategies and objectives can evolve over time, but the sooner you take a hands-on approach to mapping out your retirement, the better. Time can be an invaluable resource in retirement planning that you can’t get back. So, give yourself as much time as possible.
Retirement Regret #3. Underestimating the Length of Retirement
How long will you need to live off of your retirement savings? If you don’t know the answer to that question, how can you save enough for retirement? That’s another major issue today’s retirees face because many lack “longevity literacy.”2
In other words, we tend to have a poor sense of how long we’ll live. Failing to consider that in retirement planning can really short-change us in the long run.2
Pro Tip: Don’t look to your parents or ballpark estimates when it comes to life spans and the duration of retirement. Crunch the numbers and look at the latest life expectancy data (it does change from generation to generation). Also, work with a professional who can help you double-check your estimates, assumptions, and calculations.
Retirement Regret #4. Overlooking Inflation
Inflation is an inevitable part of the market cycle, and it’s almost impossible to ignore these days.3 Still, inflation can take more of a back seat in retirement planning, with many people making the mistake of relying on today’s costs when estimating tomorrow’s expenses.
Just like underestimating the length of retirement, underestimating inflation can put a real drag on retirement savings, creating unnecessary financial stress in the future.
Pro Tip: Don’t forget to account for rising costs when you’re planning for retirement. Use current projections to estimate future inflation. Then, create a budget for yourself in retirement, estimating your costs so that you have a more realistic idea of how much you need to cover your monthly expense as a retiree. Also, revisit these estimates regularly, updating them as needed. Keeping an eye on inflation can keep you mindful of savings goals and the expenses you need to be prepared for in retirement.
Retirement Regret #5. Not Having a Sound Investment Strategy
What’s your current strategy for building your retirement savings? When will it be time to adjust that strategy?
Believe it or not, many people have a set-it-and-forget-it view of retirement planning. They know they need to save and that they want to retire, but they’re not necessarily thinking about risk tolerance or how aggressive to be at various phases of retirement planning.
That can result in lost opportunities to amplify retirement savings, like missing out on employer contributions and options to make catch-up contributions.
Pro Tip: Automating savings is a good start, but it shouldn’t be the only part of your retirement planning strategy. Bolster that with diversified investments and routine reviews of both your strategies to ensure they continue to work for you.
A Better Path to a More Fulfilling Retirement
Retirement is a complex financial decision that’s also deeply personal. As exciting as it can be to cross the “finish line” of work life and retire, timing it right matters. So does sensible planning that takes a realistic approach to your needs and goals for the future.
So, if you’re serious about setting the stage for a comfortable retirement unburdened by regrets, don’t cheat yourself by cutting corners or assuming you know it all now.
Instead, look at retirement planning as a work in progress and equip yourself with the resources you need to make more solid plans for the future. That can include deeper knowledge about retirement and finances. It can also involve the support and guidance of an experienced financial professional.
Sources
This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets. This material was developed and produced by Advisor Websites to provide information on a topic that may be of interest. Copyright
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