Grandparents Raising Grandchildren

Raising children is something often done by parents in the prime of their life, typically between the ages of 20 and 50. By the time retirement comes around, most of the children are off on their own, leaving the parents to finally take a well-deserved rest. Aside from occasional contact with their young grandchildren, grandparents are usually able to live their lives free of the responsibility of raising youngsters. But what happens when the grandparent suddenly becomes the primary caregiver for their grandchild or grandchildren? Grandparents raising grandchildren is a scenario that often arises due to an unforeseen circumstance involving their adult children – whether it be their untimely passing, a drastic life change like a divorce or a move, or an unfortunate occurrence like incarceration or hospitalization. When this happens, everyone involved faces many challenges as they struggle with handling their new lifestyle. Emotional Challenges When a grandparent becomes the primary caregiver for their grandchild or grandchildren, many emotional challenges can arise. There may be feelings of loss or devastation if a death or medical emergency led to the change in circumstances. Children may be coping with feelings of abandonment and experiencing separation anxiety. The lives of everyone, including the grandparent, may remain in a state of upheaval for several months or even years. While dealing with their own emotional challenges, the grandparent can be faced with the difficult task of raising their grandchild or grandchildren at an advanced age. Counseling with a licensed therapist, support groups, teachers, coaches, and fellow grandparents can all be great assets during this time of transition. The sooner help is sought, the sooner healing can begin. Financial Challenges When planning for retirement, finances are often carefully calculated to include the expenses of only one or two people – depending on if a spouse is involved or not. Adding in one or more children can create a huge financial burden on the grandparent that was completely unexpected. Financial extras like a larger grocery bill, medical expenses for the child, back to school supplies, the cost of sports and hobbies for the child, and potential college funds are all things that can arise while caring for the new members of the household. Meeting with a financial expert immediately can be the best way to handle the financial changes that can occur when a grandparent becomes responsible for raising their grandchild or grandchildren. They can plan out a budget and correctly allocate assets where they need to be. Physical Challenges There’s a reason most people choose to have children when they are younger. As the body ages, keeping up with little ones becomes increasingly difficult. It’s important that grandparents keep their health always at the forefront of their minds, even if their time is now mostly consumed with caring for their grandchildren. Staying active, eating healthy, getting enough rest, taking prescribed medications, and visiting the doctor regularly are all excellent ways to keep the mind and body in tip-top shape while raising kids. Finding time to stay fit may seem impossible, but fitness centers often offer daycare at their facilities, giving grandparents plenty of opportunity to exercise. Check with local churches and recreation centers for babysitters when the need arises, as well. Challenging But Rewarding Grandparents raising grandchildren can come with many challenges, but it also offers countless rewards. Being able to spend so much one-on-one time with grandchildren can keep a grandparent youthful and happy, no matter how difficult the situation was that led them there. The added bonus of having experience raising children can make this time around much more enjoyable.

How To Handle Market Volatility

Looking back at the past few weeks, the market has made some investors nervous.  Market volatility can lead to some serious stress but what are the best ways to respond to this uneasy feeling?  When dealing with market volatility, it’s important to keep several things in mind to avoid making major mistakes. Have a Plan It’s frequently said that those who fail to plan are planning to fail. When investing, it’s important to have a plan. If your plan is to put $1,000 or $5,000 into an index fund each month, it’s important to keep it up whether the market is up or down. Slow and steady wins the race. Sticking with your plan will allow you to take advantage of the periods when the stock market is down.  Keep Reinvesting Dividends and interest tend to keep coming whether the Dow Jones Industrial Average is down 500 points or it’s up 300 on a given day. It’s true that there are situations that will lead some companies to cut or suspend their dividends. However, most companies will keep paying out dividends as long as possible because a cut is a sure-fire way to lose investors and see the price of your company’s stock drop like a rock. Dividends from stocks and interest from bonds are two of the best ways to deal with volatility. You should keep reinvesting the capital your investments throw off. When the market is down, you’ll be able to buy more shares, and this will add to your flow of dividends and interest. By reinvesting during periods of volatility, you’ll be able to increase the power of compounding greatly.  Don’t Sell Many financial professionals will tell you to avoid selling your investments at the worst possible time is a part of sticking with your plan.  Often times, this is an ideal strategy.  It can be tempting to sell when the market is down 10% so that you can avoid the next 20% loss. This is generally a bad idea. Time in the market will usually beat attempts to time the market.  Although, one exception would be drawing down some money strategically during your golden years. You’ll probably want to make quarterly or annual withdrawals regardless of what the market is doing in that case so that you can fund your living expenses.  Rebalance Another important step to take when the market is showing extreme volatility is remembering to rebalance your portfolio periodically. You may have a strategy of rebalancing quarterly, semiannually or yearly. If you have a target allocation of 75% of your portfolio in stocks and 25% in bonds, a major drop in stocks could leave you with 65% in stocks and 35% in bonds. In this instance, you’d sell a chunk of your bonds and move the money into stocks. If you’re still in the accumulation phase, you could stop contributing to bonds and put all of your money in stocks until you reach your targeted balance. This will keep you from becoming too overweight in one area and allow you to maintain the proper level of diversification. One big piece of advice that’s important to remember during market volatility is to stay the course. If you have a plan, stick to it. This includes making periodic investments as you would if the market were at record highs. Real money is made during market downturns. If your portfolio gets out of balance, it’s a good idea to rebalance it in the event of a major market downturn to take advantage of the sale price on stocks. If you have cash sitting on the sidelines, volatility to the down side can be a great time to put that money to work. Planning your retirement means diversifying to reduce the risk to your overall retirement plan.  We are here to help guide you to and through a successful retirement. 

Bad Idea? Women Leave Money Decisions To Their Spouse

When couples get married the finances are typically left to one person. It is rare for both parties in a marriage to handle the finances together. In some cases, it is the wife that is leaving the husband to handle all financial issues. This may be common in some relationships, but it is not exactly a sound approach to managing the money in every case. Difference In Opinion The trouble that can stem from this type of one sided financial domination are the differences in opinion on things, and the person that is ruling the checkbook is typically going to have the final say. In some instances where women may want to do different things with the money that they both make it can be hard to find an even compromise. Men that are in this position of managing the finances may feel that they know what is best for the household because they are the ones that are looking at the numbers. This can cause conflict. It may become harder to resolve when both parties are not taking a conscious effort to look at what is being spent. It essentially causes more trouble because there going to be times where a joint decision needs to be made. There are a few times where a single person can make a decision for two people without some type of conflict becoming the result of this decision. Long Term Planning When one person in the relationship it can become harder for the woman to justify what is considered essential.  There may be things for the children that couples disagree on.  This can cause problems in a marriage. I t builds walls where the husband and wife may be in constant conflict.  Working together to achieve long term goals will likely lead to better planning for the spouse left behind after one passes. Divorce When the husband has been in charge of the finances things get very tricky during divorce proceedings. This is what many women have not give much thought to.  They can assume that the vows that they have taken certifies the spouse to be in a position of authority when it comes to financial matters. The trouble is this line of logic does not play out very well in court during the divorce proceedings. It is better to know what is going on at all times when money is the issue at hand. No wants to walk away from the divorce without the ability to sustain themselves if the marriage comes to an end. Unfortunately, women that let their spouses handle all the money decisions could find themselves in this type of situation. Death Of A Spouse Most women would rather not think about it, but the death of a spouse can result in total chaos when it comes to financial issues. When the husband is the one that is tending to retirement plans, investing and household expenses the wife may be on autopilot. She may have the slightest idea on what her next step will be if she is put in a position where she has to handle any of these things. A shared role when it comes to finances will result in both a husband and wife making decisions together.  This will results is better goal planning, expectations of savings and budgeting (especially in your retirement years).   If this process is uncomfortable in your relationship, work with a financial professional to lay out a well thought out plan that can take the guess work out of your finances and future in retirement.

The Unexpected Can Occur At Any Age

This topic is not comfortable for everyone to talk about but planning now can make a world of difference later.   More than a third of long-term care residents are younger than 65 years of age. This statistic reminds us that we should prepare for the future, and the earlier you start preparing, the better.  Here are some steps you should take to prepare for your golden years.  Draw up a Will You’ll want to decide how your estate gets divided up. If you don’t decide while you’re alive, the state will do it for you. That’s why it’s important to draw up a will. It’s estimated that only 40% of Americans have a will or estate plan set up. Not only will you avoid having the state decide how your estate is divided up, your family will not have to worry as much if you’ve given them clear instructions as to what should happen when you die.  Draw up a Living Will Another issue that the state or your family could decide is how to administer your end-of-life care. A living will gives directions as to how much medical care you’ll receive beforehand. You might not want to deal with heroic medical care if you’ve passed 80 years of age. You can let your family and medical providers know your wishes. Absent such a directive, doctors will frequently administer expensive and invasive treatments that are not likely to work on elderly patients.  Buy Life Insurance As noted above, no one knows when he or she will die. That’s why it’s important to buy life insurance. This insurance will provide a death benefit, and it can also build cash value over time. The presence of cash value associated with life insurance can be a tax-efficient way to build wealth over time. Additionally, if you die with dependents at home, you’ll be able to provide money to care for them in your absence.  Buy Long-Term Care Insurance Another option for avoiding major costs in your later years is the purchase of long-term care insurance. About one in eight Americans will wind up in a nursing home at some point. This cost can impact even fairly wealthy families. Long-term care insurance can take care of some of the expense that comes from staying in a nursing home or extended care facility. Medicare does not pay for long-term care, and these costs can definitely add up over time.  Stay Healthy  Staying healthy can be a good way to increase the likelihood you live to old age and avoid some of the costs that are common with aging. Maintaining your health will be easier if you eat well and exercise. Those who take care of themselves are able to stay in their homes longer and are less likely to die young. Also, because you’ll be able to hold off on many of the health issues that lead to long-term care, more of your nest egg will be available for your heirs. Plan now, your spouse or your executor will be happy you took the time to prepare for your end-of-life details. Additionally, your heirs will be happy you took care of yourself because you can leave more of your nest egg for them.

Baby Boomers Bomb This Question

With all of the day-to-day demands on your finances, sometimes it is difficult to have a strong grasp on what your overall financial picture really looks like. While many people may be very in tune with one segment of their financial life, you may be inadvertently neglecting other parts. One often-overlooked financial aspect is retirement savings. In fact, you may be surprised to know that according to the Motley Fool, 42% of baby boomers cannot answer the question of “How much have you saved for retirement?”. While this revelation may seem shocking, it is a reality that, for many, immediate financial needs tend to take priority and retirement savings get put on the back burner. One reason for this may be that saving for retirement is complex. Many people know that they have spent their work life contributing to an employer-sponsored plan and/or IRAs, but they may set their monthly and quarterly statements aside, never really looking at how much their account has grown to. Others may have multiple 401(k)s and other plans with previous employers that they have never combined into a rollover IRA, or that they have lost track of. For this reason, it is imperative that those who are approaching retirement start taking control of their retirement savings by working to create a definitive retirement plan. Retirement planning allows you to dig deep into what you have saved and calculate your total amount of retirement savings. It also allows you to get an educated estimate of what your expenses in retirement may be, as it would be impossible to know if you have saved enough if you don’t know what you will be spending. If you are an organized, motivated person, you may be able to easily calculate this information on your own using an online retirement calculator. If you need more assistance, or have a complicated financial picture that requires in-depth expertise, then working with a personal financial planner may be more appropriate for you. Once you have an estimate of what you currently have in retirement savings and what your projected spending during retirement may look like, you will be able to determine if you are ahead of the game or far behind when it comes to additional savings required. You may see that the only way to retire on time is to start contributing more to a retirement plan now and cut back on some unnecessary expenditures. You may also find that you will need to stay in the work force longer than you had wanted or anticipated. Whatever your situation is, starting to work on your retirement plan earlier will give you more time to make up the difference that you need. If you find yourself in the category of someone who responds with “Um..” or “I’m not sure” when asked how much you have saved for retirement, know that you aren’t alone. Many other people are in the same boat. Luckily, you can start taking control over your retirement savings today by beginning the retirement planning process and getting yourself on track to meet your retirement goals.  We are here to help!

Avoid New Retirement Over Spending

You’ve put your time in and the day you’ve been waiting for has finally come. It’s time to retire! You’re done working 40+ hours a week and ready to enjoy the money you’ve been saving for years. Slow down for a minute, though. It can be tempting after working for so many years to start checking off all the items you’ve been adding to your bucket list throughout the years, but this can lead to some severe overspending. It’s a nice gesture to invite your entire extended family on vacation or help your children pay off some of their debt, but you need to focus on the future. When you work, you have a steady stream of income along with a healthy savings account to fall back on when unexpected expenses pop up. When you retire, it’s like someone just threw a few hundred thousand or million dollars at your feet and said “have fun! You can avoid overspending by cutting back on certain luxuries you’re used to having. The balance comes with developing a smart financial plan to ensure you live within your means while still enjoying the quality of life you’re used to. Here are some essential tips to get you started on the right path.  Create a Budget You should be no stranger to a budget by the time you retire, but you’ll need to start tweaking it to adjust to your new financial circumstances. Know how much money you’ll have coming in between social security, pensions, and your retirement plans such as a 401k. Split your expenses into those that are required, such as housing, food, and vehicle maintenance, and another category for discretionary purchases like vacations.  Develop a Withdrawal Strategy Once you know how much you need to live comfortably every month, you can determine how much you need to take from your retirement every month. A standard 4% withdrawal rate should tentatively last 30 years, but this can vary based on your savings, the financial market, interest, and hefty expenses such as healthcare.  Cut Back on Expenses  Cutting back on spending is painful if you’re used to getting what you want when you want it, but it’s a necessary part of smart financial planning. Evaluate whether you can make changes to the two highest expenses: housing and health care costs. Healthcare: Retirees spend roughly 11.4% of all income on medical care because Medicare only covers 80% of costs. That 20% responsibility can swallow up your income. It also fails to include eye exams, orthotics, and dental care. Find a supplement plan to help ease your financial burden. Housing: The average retiree 75 or older spends 43% of income on housing and related expenses. It’s beneficial for many to downsize to a smaller home or move to an area which a lower cost of living than where you currently are. The adjustment can free up income for discretionary purposes. Other basic actions such as not eating out as often or capitalizing on discounts and specials for seniors can also keep your wallet a bit thicker.  Hire a Financial Advisor Seeing a financial advisor can put financial responsibility in someone else’s hands. They can look at your investments, determine an acceptable withdrawal schedule, and examine your current and past spending to give you helpful tips and advice. It’s smart to fix an overspending problem sooner rather than later, which financial advisors recognize and work quickly to remedy. Their goal should be to help you have the most money to enjoy the golden years that you’ve worked so long for.  We are here to help, contact us, today.

Think Before You Build Your Retirement Dream Home

Building your dream home for retirement is not an uncommon goal many Americans have. However, just because it’s a common dream doesn’t mean it’s an appropriate dream for a large portion of the population. Sure, you may have several hundred thousand or a couple million in your retirement accounts. You’ll still want to think before you build your retirement dream home.  Think Location Three of the most important considerations to take into account before building a dream home are location, location and location. You’ll want to ask whether the location you’re looking to build on is an up-and-coming destination or one that’s had a downturn for several years. No one knows what the future will hold, but a home in a desirable location is more likely to sell than one in a depressed area. If your chosen destination, even if it’s near a beach or ski resort, has had stagnant or declining home prices for years, it’s a sign that it might not be a good place to build a home. Another concern would be the average length of time properties stay on the market in a given community. If there’s a low supply of houses and a short turnaround when they go on the market, your chosen location might be a good fit. If houses stay on the market for a year or more, it might be a good idea to look elsewhere.  Think About the Kids Most people who retire want to spend time with their kids and grandchildren. This might make it seem like buying or building a dream home near the kids would be a good idea. Think again. People move for jobs every day. Sometimes, that move will be from one building across the street to another. Other job moves will require a move across a state or across the country. Building a dream home close to your kids today does not guarantee it will be close to your kids five years from now. Additionally, dream homes tend to be on the upper end of the price scale, and this can mean they’ll sell less quickly than more affordable homes. Therefore, if your main reason for building a dream home is to be close to your children, it might pay to ponder the decision a bit longer.  Think About Cash Flow No matter how big your nest egg happens to be, you always need to think about cash flow. This goes if you’re 30 years old or 60 years old. Overspending on a home is bad for cash flow whether you’re making $50,000 a year with no money in your nest egg or making $150,000 a year with $750,000 in your nest egg. If you have a nice chunk rolling in from a pension or Social Security, this might work in your favor for building your dream home. Keep in mind that you might want to downsize your dream home a bit to keep more cash working in your favor regardless of your current financial situation. It’s also a good idea to remember that most people decline physically over time. This means that a multistory dream home will be less accessible in a few years. If you need to hire some help, that will put additional strain on your cash flow as well. There’s nothing inherently wrong with building a dream home as long as you can afford it. However, there can be some pitfalls that come from building one for retirement. Most people will eventually have to downsize, and having too much equity tied up in a home can make it more difficult to do so quickly. Taking all facets of building a new home into account is an important step to take before you ever sign on the dotted line to start your build. Remember, we are here to help you with all aspects of planning your retirement. Contact us, today.

Your 2019 IRA Guide

When it comes to retirement savings, one of the best options available to those who don’t have a workplace retirement plan is an IRA. These savings vehicles allow for future retirees to save up to $6,000 per year in a tax-advantaged manner as of 2019. Those who have reached age 50 can add another $1,000 to their accounts each year.  Types of IRAs There are two main types of IRAs. The first is the traditional IRA, and it allows individuals to save on a tax-deferred basis. Effectively, a traditional IRA allows account holders to cut their adjusted gross income by the amount of their savings. This will cut a retirement saver’s taxes in the year the money gets saved. The second is the Roth IRA, and this account allows people to save after-tax income while allowing for tax-free growth and withdrawals as long as certain conditions are met.  When Are Taxes Due? The tax advantages of IRA accounts are their strongest characteristic. In a taxable account, savers would have to pay taxes on any dividends or capital gains earned within a given year. Within an IRA, those taxes are deferred in the case of a traditional IRA or nonexistent in the case of a Roth. Those who have a Roth IRA pay their tax bill up front, and the government will never tax the contributions or the withdrawals as long as the withdrawal of any gains comes after age 59.5. On the other hand, those who save in a traditional IRA will have to pay taxes when they withdraw the money. The effective rate could be 0% as long as the taxpayer has enough deductions to avoid exceeding the standard deduction or any itemized deductions. Most people will not find themselves in this situation. The rate could theoretically go up to the top marginal rate the IRS charges at any given time. As of 2019, that rate is 37%, but a retiree would have to have an income of more than $500,000 to hit that rate. With a Roth IRA, it’s possible to take out the contributions without penalty at any time as long as the account is at least five years old. This is not possible with a traditional account. Any withdrawal from a traditional IRA will be taxable because of the up-front tax deduction. The government wants the tax revenue at some point. Any withdrawals of contributions or growth from a traditional IRA would incur an early withdrawal penalty of 10% if the account holder is not yet 59.5 years old. Only the growth would see the early withdrawal penalty with a Roth.  Which Is Better? Like many personal finance decisions, the answer to the question of which IRA is better depends upon a person’s individual situation. Those who have higher incomes can lose the tax benefit on a traditional IRA if they have a workplace retirement plan like a 401(k). The ability to contribute to a Roth IRA phases out if a worker makes $137,000 as of 2019. Couples can make up to $203,000 and still contribute to a Roth. Those who are married with children and have a relatively low income would likely do better with a Roth because they would pay little in taxes even before any IRA savings. Those with a higher income can take advantage of the tax-deferred benefit of the traditional IRA. It’s also possible to contribute to a “backdoor” Roth account. Families with higher incomes could transfer money from a traditional IRA to a Roth in years they have a low adjusted gross income due to deductions from business losses or other reasons. This allows for the tax-deferred deduction up front and the benefits of tax-free withdrawals from a Roth while minimizing taxable income throughout the process. Another consideration when it comes to IRAs are the required minimum distributions, commonly known as RMDs. There are no RMDs with a Roth IRA, which could leave the money to compound for decades after retirement. Those who invest in a traditional IRA will have to take out a growing percentage of their accounts each year after hitting 70.5 years of age. The percentage grows each year based upon expected mortality rates. Again, the government wants the tax revenue at some point. Regardless, of which account a person decides to use, deciding to save for retirement is an important step to take to ensure financial stability in old age.

Is Your Pension at Risk?

Everyone faces the concept of retirement at some point. The closer an individual gets to retirement age, the more concerned he may become about his ability to live comfortably after retirement. It may also make him wonder whether his retirement benefits will be available when he is ready to collect. The Future of Pensions Those who expect to collect a pension when they reach retirement age may have become concerned about recent reports regarding pension-fund growth. Recent issues regarding pension fund investments such as: • Modest economic growth • Low interest rates • Rich stock valuations These factors have caused some economic experts to begin reevaluating previous assumptions they had concerning returns on pension funds. Keeping the above factors in mind, anyone whose retirement income includes a pension is encouraged to speak to a financial adviser to assess the effects these projections may have on his financial plans. One problem is the benefits many state and local governments are committed to paying cost more than the availability of funds. This shortage of funds could result in decreased pensions for retirees, increases in taxes or decreases in other programs funded by various governmental agencies; this may be necessary to cover the deficit in the pension funds. According to the National Association of State Retirement Administrators, the low interest rates that have been consistently in effect since 2009 has led to a re-evaluation of many public pension plans. This has been necessary for these entities to project potential long-term investment returns. In addition, they have been forced to reduce previous assumptions regarding plan investments This has been necessary to allow these entities to project potential long-term investment returns. Public Pension Funding Government-funded pension plans reported assets of $4.41 trillion during the period ending September 30, 2018. How are the assets used to fund the pensions? They are held in trust and invested so that they will be available to fund the cost of pension benefits. The return on those investments is essential since the earnings from those investments provide most of the financing for public pensions. Any shortage in projected long-term earnings from those investments must be replaced through increases in contributions or reductions in benefits.  Projections are necessary to fund a pension benefit and make assumptions concerning future events. Public pension plans typically consist of two components: the real return rate and inflation. When these two components are added together, the result is what is called the nominal rate of return, the most common rate used in the industry. The real rate of return is the second component of the return on investment projection. This component consists of the actual return on the investment after it is adjusted for inflation. The purpose of knowing the real rate of return is so those in charge of monitoring the pension funds know the return that the investment generated for the fund. This allows them to better assess the future of the fund and plans for future investments. The risk an individual pension may face is contingent upon several factors: inflation, return on investments and rate of return. While currently corporate pension funds are doing better than government-funded pension funds, this continued growth could change at any time. Pension funding always carries an element of risk; the future retirees need to follow the news in order to make plans for their future income.

Probate & Your Retirement Accounts

Planning for retirement allows for many considerations and avoiding Probate is one of them.  The good news is if own a retirement account and have named beneficiaries, the account does not have to go through the probate process in most cases. Avoiding probate should be one of the goals of proper estate and retirement planning. While probate is a good fail-safe to ensure the property of a deceased owner is distributed fairly, probate also introduces delays, expenses, and headaches that are not usually necessary. What Is Probate? Probate is the judicial process in which the property of the deceased is fairly distributed to creditors and heirs. In the United States, probate is based on the wishes of the deceased as laid out in a document called a will. The probate court will ignore any instruction in the will that is not legally binding. If no will exists, state laws of inheritance are followed. As probate is a judicial process, there will be court fees and lawyer fees paid out from the holdings of the estate. Some lawyers base their fees on the value of the estate in probate, so minimizing the value of the estate will save money which can be distributed to the heirs. The probate process also takes time – for a non-contested will, probate typically takes from six to eighteen months to complete. Why are Retirement Accounts Different? A will cannot supersede instructions in other legally binding documents or contracts. In the case of retirement accounts, there is an agreement on how the money will be distributed to beneficiaries after the owner’s death. If valid beneficiaries are named on the retirement accounts, those beneficiaries will be entitled to the portion of the account as named. If the will directs how the retirement accounts should be settled, the court will ignore that part of the will during probate as long as the beneficiaries are valid. Under What Circumstances Do Retirement Accounts Go Through Probate? There are a few circumstances in which retirement accounts will go through probate. If the retirement account owner has named his or her estate as the beneficiary, the retirement account will go through probate. If the beneficiaries are not valid – such as a deceased person or a minor – the account will go through probate. In some rare cases, a retirement account owner may want their retirement accounts to go through probate. If the owner has outlived everyone he or she would care to name as a beneficiary, the owner may wish to pass the account through probate. A more common reason why retirement accounts pass through probate is because the account owner did not keep the beneficiary list up to date. If the owner started a job before starting a family, it would make sense to name the estate as the beneficiary. The accounts would go through the probate process if the owner did not change the beneficiary list as his or her life circumstances changed. In the community property states, a living spouse is entitled to at least half of the value of retirement accounts. If the spouse is not named as a 50% or greater beneficiary for the retirement account, the spouse can claim their share in probate court. In other states, surviving spouses are guaranteed something from the deceased’s estate. If there is no or little remaining value beyond retirement accounts, the probate court will consider retirement account money even if the spouse was not a named beneficiary. When planning an estate, it is essential to know how property will be distributed upon the owner’s death. Different rules and laws apply to different assets. In general, it is best to avoid probate whenever possible. For retirement accounts, the time and expense of probate can be avoided by naming valid beneficiaries on the retirement account. Be sure to check your beneficiary designations every few years to make sure the money is distributed according to your wishes.