older couple worried about money

Aging & Financial Fragility: How Seniors Can Use Their Experience to Survive & Thrive Through Giving

“Good judgement comes from experience…unfortunately experience comes through bad judgement.”

These  words of wisdom came from my father, a depression era baby who was very pragmatic. He constantly tried to guide me to protect myself in what he called a “dog-eat-dog” jungle out there. Certainly, seniors need to be very aware and cautious of “get rich quick” schemes and the proliferation of people and organizations actually preying on seniors.

Seniors face many financial risks. Running out of money is probably every senior’s greatest fear. Another is not being able to enjoy the golden years in a manner that is affordable and enjoyable. Being proactive and doing some careful budgeting and planning in advance is critical. As the old adage goes, “an ounce of prevention is worth a pound of cure.”

What can you do now?

In the budgeting process, be aware of what your prospective annual costs are and estimate your life expectancy. Match your planning needs to accommodate your unique retirement goals (hobbies, travel, family, fitness, etc.) It’s also important to start building up a financial “war chest” now to meet your budgeted needs.

Some ideas to expand your financial “war chest” include:

  • Delay Social Security until age 70 to maximize payout (if possible.)

delay Social Security

  • Delay taking retirement account distribution to 70.5 years.
  • Consider moves to lower tax states like Florida.
  • Consult with a tax expert to make sure you are getting maximum benefits.
  • Plan for a part time job after retirement to augment retirement funds. Almost 22% of Americans 65 and older expected to have a part-time or full-time job by 2026.
  • Balance your needs with taxes, death, legacy goals.
  • Manage your debt.
  • Consider life insurance as an asset class which can diversify your portfolio and provide tax-free growth and protect against market volatility.
  • Explore the value of your life insurance policy as it may be a source of hidden cash

Thousands of individuals have life insurance policies they are not aware of and billions of dollars in life insurance benefits stemming from long neglected or unknown life-insurance policies are everywhere. Too few understand they may be able to cash out with a  “life settlement,” or sale of an existing life insurance policy to a third party. Use this Life Value Calculator to estimate how much your life insurance policy will be worth when you sell it.

Let’s say you get lucky selling your policy. How best to utilize what may be a windfall profit:

We all know the adage, ”It is better to give than to receive,” These simple words have a very profound impact. Why is giving so important and something that should be incorporated into your daily life? The reasons are many, and there are so many books available that measure the actual bodily and mental benefits that giving provides the giver. One study demonstrated that for every $100 worth of charity the donor gave, it resulted in additional income of almost $400 specifically related to that giving. This financial benefit pales in comparison to the mental and spiritual health benefits that researchers have discovered.

 Countless studies have been done by psychologists, social psychologists, and others to buttress this claim. How can we find ways to give creatively with assets that may be going to waste?  Here is a great idea…

If you have a favorite cause or organization you would like to help (and have an existing insurance policy you don’t feel you want or need anymore), consider selling that policy and gifting the cash to that cause or organization. Not only does the charity get an immediate benefit of cash, there are no appraisal fees, and there is an immediate tax deduction for the donor. A win/win all the way around!

My dad always instilled in me the win/win philosophy.  It has been very meaningful for me to incorporate that into my daily life and generating “found money” that everyone enjoys, and then giving back some portion or all of it exemplifies this philosophy and also fights the taxman, another cherished goal of my dad’s.

David Kottler is a national speaker, author, and entrepreneur who combines his legal and business experience to help his Americans fulfill their life mission both philanthropically and financially. Also known as “The Insurance Dr.” Kottler draws on his 24 years of financial planning experience to create game-changing results for his clients through his innovative “True Value”TM life insurance review process. Over the past few years, he has generated over $30 million dollars in cash and tax benefits for his clients. Kottler is the author of two books. His latest book, The Best Kept Money Secret in Your Insurance Policy, was written to empower his clients and other financial professionals to get the most out of their life insurance policies in their portfolios. David explains how to use life settlements, financed life insurance, and his expert analytical review process to find and protect hidden value in life insurance policies.   


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