Financial Q&A: Estate planning differs for women

Although the estate planning tools and financial strategies for each sex do not differ, there are certain aspects for women that should be considered when planning for retirement and the future. Whether married or single, the challenges that women often come to face in their later years make planning a little different for women.

First of all, women tend to live longer than men. One key aspect of estate planning that women often overlook is what will happen when their husband, parents or other relatives die. According to the U.S. Census Bureau, 36 percent of women over the age of 65 are widowed. Compare that to just 12 percent for men 65 and older who are widowers. Living longer means a longer retirement and more medical bills to cover. This can lead to a retirement crisis when a majority of a couple’s income is the husband’s Social Security or pension benefits, which stop upon death.

Another difference between the sexes is that women have a tendency to have custody over, or offer care to, their children or their own elderly parents. When it’s all said and done, husbands and wives may think differently about the future and the end-game, but the wife may eventually live out the plan.

So, what are some things that women should consider when making their estate plan?

First, take a good look at your income. Where does it come from and how much will you need? Will you be entitled to any death benefits if your spouse dies? Are there any other benefits that you may be entitled to receive such as VA assistance or Medicaid? When do you need to start pre-planning for long-term care?

These are important questions you should ask yourself.

Second, take an active part in the planning process. This should include carefully deciding on who is going to be in charge of making medical and financial decisions for you, as well as your spouse if you are married. This is especially critical if you happen to be in a second marriage. Also, take a good look at your medical condition and take into consideration any current or anticipated health problems.

Third, if you are caring for an aging parent, make it a point to talk to your siblings and parents about the potential implications. Does your parent’s estate plan take into consideration their need for long-term care? How might this affect you and your ability to keep working?

And although it is important for everyone to have an estate plan, it is critical for women to plan, and plan well. Fortunately, there is much advice to be gleaned on the topic, and the assistance of experienced estate planning legal counsel is essential.

Stephen J. Lacey, JD, LLM-Tax is a member in the law firm McClelland Jones LLC. Lacey concentrates his practice in estate planning, asset protection, Medicaid planning, probate.