Settlements for Seniors and Retirees

Settlement Advice for Seniors and Retirees

SETTLEMENT PLANNING FOR SENIORS

Tackle the Fear of Outliving Your Settlement Money

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Settlement Advisors for Seniors

Structured Settlements For Seniors

  Benefits of Structured Settlements for Seniors and Near Retirees

 

  • Maximize social security using a structured settlement , to provide income that will give a senior the option to delay receiving social security until age 67 or 70 when benefits are higher. For example, a 65-year-old, with a full retirement age of 66, could receive 30% more each month waiting until age 70, according to the Social Security Administration. Click above to watch an informative podcast on maximizing your social security with a structured settlement, featuring 4structures.com LLC President, Master Structured Settlement Consultant and Sudden Money®Advisor John Darer®. 
  • Spouses can count on tax exempt income for their entire lifetimes using structured settlements with joint and 100% survivor payments. 
  • Provide for a younger spouse with school age children, if uninsurable for life insurance, or insurable but rates are unaffordable.
  • Short term rates are up, making short term structures viable again to address specific needs. A short-term structure combined with a managed investment account could add stability to help offset vagaries of the market
  • Mitigation of volatility for older workers with employment claims, particularly those within 10 years of retirement, who have a short horizon they have to recover from investment losses. With employment structured settlements , the   level of tax deferred monthly income is generally greater than what can safely be obtained (after-tax) from other conservative investments, without the uncertainty and volatility; 
  • Use a rated structured annuity to fund an irrevocable life insurance trust (ILIT), if medical risk factors allow the arbitrage. Claimants with health impairments may benefit from a rated age and use the resulting savings on the cost of annuity payments to help offset the increase in life insurance, or second-to-die life insurance premiums resulting from the same condition.
  • Set up an annual holiday gift fund for each of your children and/or grandchildren that will continue as a legacy after you're gone.   Holidays are special times, but they can also be stressful.  A loving legacy gift from grandma or grandpa, or a special uncle or aunt arriving around Thanksgiving every year is something that has meaning beyond the dollar amount and will long be remembered and something you can have authorship over now.
  • Guaranteed monthly payments could be paid to children or grandchildren.  By naming a beneficiary the structured settlement bypasses probate and the value of the structured settlement should not be hit with an executor or administrator charge. Some Life insurance carriers issuing structured settelment annuities offer a commutation rider which would serve to pay any remaining guaranteed payments to the children or grandchildren  (that are named beneficiaries) in a lump sum.
  • Guaranteed tax-free (physical injury, wrongful death) or tax deferred (taxable damages) Income plans can be customized to meet an individual or couple’s needs.
  • If you are insurable, allocate part of your settlement in a structure to fund the annual premiums for a long term care insurance policy, or life insurance policy with long term care rider, to address the funding of potential extended care needs. We can help you explore and implement a variety of long term care solutions (LTC insurance, life insurance with long term care rider, annuities with long term care enhancers and life care funding).
  • Consider using a structured settlement to fund a memorial in your name, a scholarship or fellowship for your grandchildren, nieces and nephews, or for a resident or fellow in the medical specialty that covers research on the injury or illness you are suffering from.
  • According to the New England Centinarian Study, people over 100 are the fastest growing segment of the US population with people over age 85 the second fastest growing group

 

Structured Settlements Address

Longevity Risk Fears

 

  • "It is always wise to look ahead, but difficult to look further than you can see"- Winston Churchill, British Prime Minister  (1874-1965)
  • "This year will shift the conversation from “life span” to “health span” — how we live healthier for longer"  Techcrunch+, January 11, 2023
  • "The year 2024 marks the beginning of the “Peak 65® Zone,” the largest surge of retirement age Americans turning 65 in our nation’s history". January 2024 Jason Fichtner PhD Whitepaper_Fichtner.pdf (protectedincome.org)
  • "By 2030, the 50-plus market is projected to swell to 132 million people"  Ibid.
  • ."Nearly 1 in 2 older adults' biggest financial fear was not having enough money saved for retirement, and this rings truer for those between the ages of 55 and 64. 1 in 4 older adults fears they'll never pay off their existing debt. Forty-five percent of people between 55 and 64 fear having high medical bills, while 39 percent of those over 65, including many on Medicare, have the same fear".  Top 10 Fears of Older Adults in 2022  SeniorLiving.Org  January 4, 2022. 
  • "As the big bulge of baby boomers head into old age, as many as half are coming face-to-face with a new American economic reality: Retirement means a descent into relative hard times, because the systems put in place when this generation was just entering its peak earning years have failed" Will Englund Washington Post May 4, 2020
  • “The mismatch between old and young will have implications across the coming years,” said Dr. Grace Whiting, president and CEO of the National Alliance of Caregivers. “We aren’t having enough children to take care of us in our old age,” United States Census Bureau December 10, 2019
  • "About half worry about outliving their savings (48%), becoming a burden to their family or others"   from Top Concerns of U.S. Seniors. an Ipsos survey of 1227 U.S. adults aged 60 and older on behalf of the National Council on Aging, published  June 18, 2019
  • HSBC Bank’s “Future of Retirement” study surveyed over 17,000 people in 16 countries and found that women are more worried about their finances in retirement than men. Here are three of the study’s key findings. 1. Over 50% of women worry they won’t have enough to cover medical expenses The study found that 57% of working-age women are worried they won’t have enough money to cover medical costs or expenses that come with medical care. A Fidelity study found that 65-year-old couples can expect healthcare costs to exceed $260,000 in retirement. Similarly, 54% of women worry they will not have enough to cover basic needs if a health issue forced them or their partner to retire early. Among men, 47% shared the same worry.  January 14, 2018
  • “Adults 69 and older say their top three financial fears are outliving their savings, an unplanned financial emergency and unplanned medical expenses”. Northwestern Mutual


 

Defined Benefit Plans Are Rare Today

Few Work for a Single Employer

 

  • Fewer employees can rely on defined benefit pension plans, where employers save for them, and employees are guaranteed a percentage of their salary in retirement.
  • State and local pension systems once seemed fiscally secure, however the façade created by assuming unrealistic rates of returns on investments and by using other accounting tricks has come home to roost. $75 billion of pension debt held by local governments in Illinois, is the primary reason for Illinois’ second highest in the nation property taxes. Combined with Illinois' pension debt, politicians who mismanaged the pension system dug a $219 billion hole. [Source:  IllinoisPolicy.org ]
  • In fact, a 2016 report from Stanford Professor of Finance Joshua Rauh estimated that the fiscal hole for state and municipal public employee pension plans was an astounding $3.4 trillion. 
  • Some employers that have defined benefit plans have been wracked by poor balance sheet choking investment performance. See here and here 
  • Even the top 100 largest corporate defined benefit plans are less than 80% funded acceding to an actuarial analysis by Milliman    in February 2016. Google “pension shortfalls” or “pension funding shortfalls” for more examples of how pension funding shortfalls are impacting the credit ratings of municipalities all across the USA. Companies shift the investment risk to employees, with 401(k)s and defined contribution plans.
  • Plaintiffs in their 50s on up may have experienced swings of volatility, having memories of the stock market crash of 1987, the mortgage crisis of the early 1990s, the dot com crash of 2000, the 2008-2009 financial crisis (where some saw their investment portfolios drop 25-40%, the horrid beginning of 2016, the rollercoaster of 2018, the Covid-19 Pandemic and seen some impact on their earnings or investments.  

 

Why ride your luck, when a structured settlement can provide core financial stability for the road ahead?


Last Updated February 13, 2024

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