Planning for Survivor Benefits and Income in Retirement
Are you sure your spouse will be financially secure upon your death? If not, you can be. In fact, there is no reason you shouldn't be. At SHP Financial, we believe one key component to any great retirement income plan is planning for survivor benefits and income in retirement. We call this a Spousal Income Plan.
What happens to one spouse if the other passes away? Will the surviving spouse keep all of the pension, social security or other income coming in? Will there be a reduction in income?
Typically, you will automatically lose the lowest social security check upon death. If there is a reduction, how will the surviving spouse continue to pay for his or her living expenses?
If you are married, we highly recommend that you take steps to ensure your income plan will carry over to your spouse. We’re not talking about your account values, but rather, the income.
Throughout the years in this business we have seen so many retirees come in with a plan for income that does not account for a loss of income due to the death of one spouse. Additionally, we have seen many people who think that when their spouse passes away, the surviving spouse’s income needs will be reduced – since the financial necessities will reduce from the needs of two people to that of one person. However, many times that is simply not the case, and the income needs actually stay relatively the same.
A well rounded retirement plan will include planning for survivor benefits and income. It will take all of these questions into consideration and have strategies in place to ensure that the surviving spouse will continue to have the same quality of life. Your surviving spouse should not ever be in the position of fearing whether he or she will run out of money or not being able to pay his or her bills. How much more comfortable would you feel knowing you have a plan in place to provide income for the rest of you and your spouse’s life? Believe us, worrying about finances is the last thing you want your spouse to worry about while they are mourning your loss.
If you'd like more information on how to create a spousal income plan, schedule a complimentary consultation with one of our financial advisors today. There is no time like the present. Take the first step in helping you and your spouse be financially secure and independent in retirement.