Whether single, married, divorced or widowed, every woman should know how to maintain her financial independence and plan for issues she might face as she gets older, such as the need for long-term care.
Women in the United States statistically have longer life expectancies than men, and therefore a higher likelihood of outliving their husbands. In such circumstances, planning for the financial future becomes critical.
Estate planning is one way in which women can take control of their finances in order to ensure long-term economic security. It is also a useful tool for preserving wealth and creating a plan for handling assets upon one’s death.
Many women tend to put off estate planning, not realizing its importance or understanding how to go about it. Taking simple steps such as writing a will or setting up a trust can reduce confusion and expenses for your family when you are no longer around.
Drafting a will forces you to review you financial situation and formally plan how you want to pass on your wealth. Without a will, you die intestate and a court decides how your assets will be divided, based upon certain assumptions.
Trusts can be helpful in protecting your assets and ensuring they go where you intended. They can protect money from children until they are older and keep ex-spouses from gaining access to your funds against your wishes. Talking to a lawyer will help you choose from the many types of trusts available, depending on your needs.
With a well-drafted estate plan in place, some of the financial impact of unexpected life events such as a divorce or the death of a spouse can be reduced. By planning ahead, you can also capitalize on federal estate tax exemptions, ensuring your beneficiaries receive the maximum amount of your assets.