I believe that inflation is a dastardly, nefarious, inscrutable enemy and that you must defeat or it will defeat you. It’s especially dangerous for retirees. Working people can usually count on their wages to keep up with inflation, but retirees often have to depend on their investments, and that’s a whole different story. Think about it: If you faced 3 percent inflation over a 30-year retirement period, your cost of living could double and then double again.
Living a long healthy life is a good thing—but it’s not great for your finances. The longer you live, the longer your money has to support you, and if you’re healthy, you’ll probably be out and about—traveling or going to the symphony or taking the grandkids to the zoo— which means you’ll spend even more money. If you’re unhealthy you’ll have medical expenses, but believe it or not, they’re typically not as big a threat to your finances as a long,
As you probably know, you can decide when to begin taking Social Security. You can get your benefit as early as age 62, you can take it at your full retirement age (you can find yours here), or you can wait and take it later, up until your 70th birthday.
If you take your benefit at 62, the Social Security Administration cuts the amount you would have received at your full retirement age by about 25 percent.
Consider the following scenario: You have a nice job that pays you $150,000 a year, and has for the last several years. Then your boss calls you in and says, “Business is bad. We just lost our biggest customer, we need to revamp our product lines, and we’re in some economic difficulty. I’m sorry, but I’m going to have to cut your pay in half until business picks up.” What do you do now? And what do you do if business never picks up?
When creating a trust, there are two basic ways to go: the revocable or the irrevocable trust. What’s the difference?
To begin with, “revocable” means “capable of being revoked” or “changeable.” If you create a revocable trust, you can change the terms and details whenever you want. And yes, “irrevocable “ means the opposite: once written, even you cannot change the trust. Both types of trusts have their place.
Flexibility is the obvious benefit to the revocable trust.