Raising the monetary security of your single girl buyers
Single buyers have totally different financial planning needs than couples, and this can be very true for women (whether divorced, widowed, or otherwise single). To showcase some of the ways financial advisors can help this growing consumer base, I was impressed by Bravo’s Real Housewives of Metropolis New York—my absolute favorite catastrophe to watch—to create three theoretical case studies. Use them while you work to increase the financial security of your single women shoppers.
Improving the Current Consumer Monetary Scenario
Serving a single buyer means understanding their individual situation, as well as the social components that typically inhibit financial security for women.
Dealing with the payout. The gap may also be narrowing (women earned 82.3 cents on the dollar compared to men in 2020, up from just 57.6 cents in 1966), but it’s not expected to close until 2059. Listed below two ideas to help consumers grow. be extra quite compensated:
Raise your confidence: A solid financial plan, with strong savings and emergency funds, could make buyers more comfortable looking for a higher-paying job or applying for a promotion or promotion.
Strengthen his knowledge of wages: Consider hosting an online, expert-led workshop on salary negotiations especially for women. Remind her to be ready at salary review by documenting significant accomplishments from the previous year. And encourage him to look for a job, to see if he can earn extra money elsewhere.
Current sources for monetary literacy. Consider hosting webinars on money literacy topics like buying a home, saving for retirement, or investing. For married buyers, make sure they are actively involved in major currency options and have access to all financial information.
Meet your new buyers: Sharona, Tonya and Lorinda
Now we are ready for our case investigation. These examples are mainly based on real housewivesBut we’ve tweaked a few details to address the main challenge: how you can help inform a recently divorced, widowed, or single buyer.
Divorced: Sharona, 64
Having worked her entire adult life, Sharona has plenty of retirement belongings. She was married to her ex-husband, Luigi, for over 20 years, and they have an older daughter.
Social security planning: Since she was married to Luigi for no less than 10 years and has not remarried, Sharona is eligible for half her Full Retirement Age (FRA) earnings amount, and will be able to collect even when Luigi should not be accumulating.
However, due to Sharona’s significant work history, her earning is greater than Luigi’s, so she will not receive a spousal gain. Which means that maximizing her social security benefits will likely be based primarily on an assessment of her life expectancy. In general, if she expects to live past 80, she’s better off delaying these benefits until she’s 70.
Property planning: After any major life change, especially after a divorce, consumers should review their beneficiary designations. At least 26 states have statutes that automatically revoke beneficiary designations naming a partner in the event of a divorce, which will not be the end result your client needs. Divorcees should also review estate planning roles, such as power of attorney, health care proxy, and executor.
Different points: If Sharona remarries, she may want to consider incorporating a Certified Terminable Property of Interest (QTIP) into her ownership plan. In the event of her death, her second husband could enter the proceeds of the belief’s assets and live on any property owned by the belief. However, she could not sell, trade or bequeath the assets; instead, these would go to her daughter.
Single with no children: Tonya, 57
Tonya is a serial entrepreneur with several profitable ventures, including a global lifestyle brand, a line of toaster ovens, and a wine brand. Although she has important belongings, she doesn’t expect to have a property tax problem, largely due to her dedication to philanthropy.
Social security planning: Being self-employed, Tonya pays both the worker and the employer parts of the social security tax. As you get closer to FRA, you could increase your profits by eliminating some of your business deductions for several years because the amount of social security taxes you pay depends on the web profits of your companies. He will have to coordinate with his CPA to see if eliminating some deductions is definitely worth improving Social Security benefits.
Property Planning: Without a property plan, State intestacy laws apply, and Tonya’s belongings would go to a father or mother, sibling, or more distant members of the family. In Tonya’s case, she wants to feature her siblings, her nieces and nephews, along with charities.
Tonya can have a revocable will and belief, along with a legitimate power of attorney and a drafted attorney’s health care power of attorney. She may need to consider using a company trustee for her to act as executor or trustee. Tonya could reasonably choose to adopt an asset-by-asset approach instead of dividing up her entire property to enable her to:
Make favorite charities the beneficiaries of your retirement belongings.
Make sure her nieces and nephews can inherit her taxable assets (they could be in the next tax bracket to her siblings and get a boosted foundation when she dies)
Establish siblings as well as obtain belongings that will not receive a base adjustment, similar to annuity contracts.
Different points: Except she plans to groom someone thoughtful of her family to take over her companies, Tonya should start figuring out the key workers who could run them after she passes away. Successfully executing and financing a purchase and sale agreement can provide assurance that her hard work will endure.
Widow: Lorinda, 56
Twice married, Lorinda was with her first husband for 10 years and Allard, her second husband, for 4 years. Lorinda has not worked for most of her life, so she does not qualify for her personal Social Security protection. Since Allard managed her funds, Lorinda was unaware of the amount of her wealth when she turned them over: he left Lorinda more than $30 million, including several million dollars in retirement accounts.
Social security planning: As a young widow with a teenage daughter named Anna, Lorinda can access some benefits instantly. Anna could earn a survivor’s gain until she turns 18 or 19, and Lorinda may very well be eligible for the child care gain until Anna turns 16. As a result of her remarriage, Lorinda should not be eligible for a spousal benefit from her first husband.
Property planning: Lorinda must ensure that her estate’s planning documentation reflects the extent of wealth she now controls. Allard gave up an exemption higher than the current $11.7 million for items of property. Lorinda needs to make sure she chooses portability on Allard’s property.
Let’s say Allard and Lorinda only had $13 million in assets and $8 million of their entire estate was in Allard’s name. No federal property taxes can be owed and Lorinda would own the full $13 million. But when the property tax exemption drops to $6 million next year and Lorinda passes away, her property would pay $7 million in taxes. If Lorinda had elected to port the $3.7 million of Allard’s unused exemption amount, his exemption would complete $9.7 million and his property would only owe taxes on $3.3 million.
For planning purposes, I recommend asking widowed buyers whether or not they elected to port-in on their partner’s death and, if so, how much of their deceased partner’s exemption was not used.
Different points: Since Lorinda was unaware of the full extent of her family’s wealth, she might suddenly have help managing it. She can help by reviewing all of her family’s funds, walking through methods she might use, and serving her long-term plan. How much can she comfortably spend? What kind of legacy does she need to disappear?
Advancing on monetary parity
Much of what is lined up here can be applied to planning for any individual buyer. For the sake of brevity, I focused on the ladies. By increasing the financial security of your single women shoppers, you’re not only helping ensure their success, but you’re also doing everything you can to increase financial parity across the gender spectrum.
Commonwealth Monetary Community® does not present authoritative or tax advice. It is best to seek the advice of a licensed or tax expert related to your personal situation.
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