A recent study reveals some interesting insights into how baby boomers and centenarians differ with regards to their attitudes, opinions and lifestyle choices.

As the lifespan of the average American continues to increase (it currently ranges from 76 years for men, to 81 years for women, according to the Centers for Disease Control and Prevention) more and more people will live to be old enough to have their 100th birthdays announced by Willard Scott on the Today Show.

Experts from the U.S. Census Bureau estimate that, in the year 2050, there will be over 600,000 centenarians living in America alone.

What makes 100-year-olds different from the rest of us?

For the past eight years the 100@100 organization has selected 100 people who’ve celebrated their 100th birthday, and asks them a series of questions about their daily lives, as well as their opinions on issues ranging from the state of the nation, to what to look for in a life partner.

This year, the survey was expanded to include a group of baby boomers ranging in age from 60 to 65-years-old. The purpose of adding this younger generation was to see where the thoughts and ideas of the two groups diverged.

Here are 12 interesting comparisons of baby boomers and centenarians, uncovered in the 100@100 survey:

1. Did you (or do you) expect to live to be 100 years old? Staying alive for more than a century caught most centenarians by surprise (29 percent believed that they would see their 100th birthday) and would also come a shock to the majority of baby boomers (only 1 in 5 feel they will live to be 100-years-old).
2. Do you regularly use the Internet? Unsurprisingly, only 18 percent of those older than 100 regularly access the Internet, compared with a whopping 82 percent of boomers. In both groups, those who did use the web were most likely to engage in either online search activities or email communication.
3. What is your favorite physical activity? Both boomers and their 100-year-old counterparts were most likely to get their blood pumping with a good walk or hike (73 percent and 55 percent, respectively).
4. Should you look for a life partner with similar interests? Many centenarians believe that having a life partner who shares your hobbies, interests and political views is a key to maintaining a good relationship, while boomers appear to place little value on sharing similar attitudes with a significant other. Forty percent on 100-year-olds emphasized the importance of having the same hobbies and interests, and 31 percent said sharing political opinions was ideal, compared to 22 and 19 percent of boomers, respectively.
5. Do you wish you had taken more risks in life? Neither group seemed to feel that they should’ve lived their lives on the edge a little more. Only 12 percent of boomers and 5 percent of centenarians said they wished they had taken more risks.

You can read more by clicking here.

1. Spend More Time On Your Not Do List

Strategy is the art of sacrifice. That’s why you may consider creating a larger clearing for what really matters by first identifying, and then avoiding, what matters the least. Your time is a treasure to be invested. Creating a list of things that you are not going to do, allows you to invest more of your treasured time on the few things that matter the most.

2. Essential first, email second

What’s the first thing you do in the morning? For many of us, it is looking at email. We wake up with a renewed mind and spirit, ready to take on the world, and then we immediately allow ourselves to be distracted by an insignificant email. Instead, wake up, take on the most important task of the day, and then (and only then) hit the email.

3. Resolve to think about the “Why and the Who” instead of the “What”

Do you work for a “What” business or for a “Who” business? Successful companies run the risk of focusing too much on their current products and distributors thus—the “What”—losing sight of the constant and dramatically changing needs of their customer base. (The “Who.”) Insurance, pharma, health care, higher education often listen too much to their agents, doctors and professors. The real innovation starts with the end consumer.

4. Resolve to find your purpose

As my friend Simon Sinek will tell you: People don’t buy what you do, they buy why you do it. Starting a career, a company or any kind of journey that is based firmly on your purpose is foundational to success and happiness. If you don’t know your company’s purpose or even your own, finding one is the worthiest of resolutions.

5. Resolve to support a cause

If you’re reading this, chances are you are one of the rare people who know how to start things. Fortunately, there are people like you who have already started causes that make the world better—they feed the hungry; they save the rain forest; they fight cancer; they do good things. Doing good makes you healthier and happier.

6. Resolve to invent more choices

You can’t feel grateful and fearful at the same time. And one certain way to become afraid is to feel trapped by any situation. The remedy is choice. The more choices you feel you have, the less vulnerable you will feel – and be.

These days, IRA’s often  make up  a substantial part of your  estate.  Yet one of the common mistakes I see is that  people assume that their will or trust automatically dictates who will receive their retirement accounts.

In fact, who will receive your  IRA (or other type of retirement account) depends entirely on who is  named as beneficiaries. Often people name beneficiaries when they open an account and then forget all about it. Another common mistake is not naming a contingent beneficiary who will inherit the IRA if  all of the primary beneficiaries are deceased.

Life insurance death benefits also go to the people you name as your beneficiaries on the application or change of beneficiary form.

Not long along I met with a new client, who told me her sad story about how she and her brother hadn’t spoken to each other in years. The reason? Her father had  purchased a life insurance policy many years ago while she was still a minor and because of that  named her brother as the sole beneficiary. He had a will but never updated his beneficiary designations.

Clearly naming primary beneficiaries and contingent beneficiaries is a very important decision. Your decision can also have important tax implications. IRA’s are wonderful savings vehicles but require careful planning if you want your beneficiaries to be able to utilize the tax benefits of their inherited accounts.

It is also important to consult an estate planning attorney for assistance if you have young children, if you are in a second (or third) marriage, or if there are any other family issues that you have questions about. An IRA Retirement Trust is a good option for some beneficiaries.

Another common mistake I see is not having any contingent beneficiaries – or naming your estate as the beneficiary. This can create a large income tax bill.

You should always list both primary and contingent beneficiaries and you should  review those beneficiary designations on an annual basis.

I’ve seen situations where a young adult opens an IRA in his 20′s and lists his  parents as the primary beneficiaries. Years and possibly a decade passes and he forgets to re-visit the designation. As a  result, the IRA went to his parents instead of  his wife and children.

The easy way to address this situation is to stay on top of your current beneficiary designations. If you have IRA’s scattered at multiple companies, you need to take the time to contact the custodians of each  those accounts and check the current beneficiary status. You could decide to use this as an opportunity to  consolidate your accounts in one place. Then it’ll be easier to review and check them to make sure they are in line with your estate plan wishes.

Here’s a follow up to our blog post from two weeks ago where Tobe Gerard shared her experience to help you understand if long term care insurance is right for you. You can read our earlier blog post here.

In this post Tobe gives us guidance on how much boomers can expect to pay for long term care.

Q. Regarding your rule of thumb “that you should be able to comfortably fit this item into your budget,” can you elaborate why? I know several people who are making budgetary sacrifices to pay for a robust long-term care insurance policy that will enable them to receive high quality care that they can select when the time comes.

Tobe: The main concern for anyone who purchases a policy that takes up an inappropriate portion of his/her budget is that if financial challenges are encountered down the road, he/she might be forced to let the policy lapse; as a result, the advantage of having purchased the coverage in the first place would be lost.

Insurance companies suggest that you don’t spend more than 6-7% of your net income on long-term care insurance. Additionally, I believe that not only should you not spend more than 6-7% of your income on long-term care insurance while you are working, but, more importantly, long-term care insurance shouldn’t be projected to be more than 6-7% of your overall expenses in retirement. Obviously, because of unique situations, this rule of thumb may not apply. In most of these unique situations, a policyholder’s long-term care insurance policy is being paid for by someone else (e.g., a trust fund, employer, etc.).

As far as the purchase of a “robust policy,” it’s important to say that all of us have very different financial profiles when it comes to our assets and income. Some people prefer to self-insure more of the cost of long-term care because they have significant assets and income, and they wouldn’t mind using some of these if/when the time comes. These are the people who usually have high deductibles on their other insurance policies (e.g., automobile and homeowner). Because some people don’t have significant assets and income, they may feel that even a rudimentary policy will provide a buffer before they would need to tap into their retirement portfolio. Additionally, some people are quite affluent and just want the best policy that money can buy, and they don’t worry about the cost whatsoever.

Oftentimes, we find that people who put other things aside to purchase a “robust policy” have particular reasons for doing so. Perhaps they have witnessed firsthand a long-term care claim where there was no long-term care insurance in place and they have seen how it has devastated their family, both emotionally and financially. Furthermore, some may choose to put other things aside to purchase a “robust policy” if they fear they may potentially have some kind of cognitive impairment in the future.

You can read the full article here.

Being an executor has always been a time-consuming job. And if the task of sorting through the remnants of someone’s life and carrying out final wishes was not hard enough, it recently got even more complicated.

An executor administers an estate and remains in charge until it is legally closed. Before that happens, the will must go through the Probate Court — the process through which a court determines if it is a legally valid document.

After that, creditors and taxes, if any, must be paid and then the named beneficiaries are entitled to their share of what is left.

If there is an estate tax audit or a will contest, the executor must oversee that process, too. Depending on the complexity of the estate and subsequent events, the job might last for a couple of years or even more.

Working closely with the estate planning process is important. Income tax returns need to be filed and often an estate tax return will be required.  Tax penalties for late estate tax filing can be substantial if the tax is not paid withing six months of  death.

When a spouse dies, there is also a new responsibility. The current estate tax law extended “portability”. A surviving spouse can carry over any part of the $5 million-per-person federal estate tax exclusion not used by the spouse who recently died.

To take advantage of portability, the executor handling the estate of the spouse who died needs to file an estate tax return, even if no federal estate tax is owed. The filing allows the unused portion of the deceased spouse’s estate and gift tax exemption to be transferred to the surviving spouse, who can then use it to make lifetime gifts or pass assets through his or her estate.

The Probate Court process can be eliminated by using a funded revocable trust plan. In that case, the trustee has the same duties and responsibilities of an executor but without the need to report to the Probate Court and submit filings to the Court for approval. However, accountings must still be prepared and sent to beneficiaries.

Being an executor or a trustee requires certain skills such as diligence, organizational ability and thoroughness. An executor should not only be honest and diplomatic, but also well organized, good with paperwork and vigilant about meeting deadlines.

Your choice can also mean the difference between an estate that is settled harmoniously and efficiently and one that gets bogged down in a legal and financial quagmire.

Here are issues to consider. It’s usually not a good idea to name all your children as co-executors or co-trustees because you don’t want to hurt anyone’s feelings. Most often it’s better to name one child and name the others as alternates.

Most people think first of naming a family member, especially a spouse or child, as executor. The advantage of this is that your next of kin presumably understands your intentions better than anybody and can readily find the assets that need to be inventoried.

There many not be a family member with the right combination of skills.  In many situations, the best choice is a combination of family member trustee and a professional Cotrustee.

If you want to name a professional trustee – a trust company – as the executor or trustee, but aren’t sure which company will be best down the road, you could appoint someone you trust to interview trust companies, negotiate fees and select one when the need arises.

This entry was posted on Tuesday, May 14th, 2013 at 7:37 am and is filed under Estate Planning, Legacy, Probate, Taxes. You can follow any responses to this entry through the RSS 2.0 feed.