Now that spring has officially arrived, hopefully you're thinking about more enjoyable things than legal planning.
But considering the importance of topics like estate planning, Social Security, and retirement planning as we get older, now is the best time to organize these matters.
The West Chester Area Senior Center in Chester County hosts about four guest speakers each year to cover the basics of legal planning, helping participants feel more confident in securing their future.
“Things are always changing and evolving, so I have ongoing guest speakers because rules change and things change,” explained Jessica Tipton, program director at the West Chester Senior Center.
The 45-minute talks conveniently take place right after lunch around 12:30 p.m. Speakers from Anderson Elder Law, Northwestern Mutual, and SeniorLAW Center are the usual guests.
“They talk about estate planning and retirement planning and also Social Security,” she said. “They also discuss how to plan for your family and how to set up trusts.”
SeniorLAW, a nonprofit law organization dedicated to safeguarding the legal rights of seniors, typically focuses its talk on wills, trusts, and powers of attorney. Established in 1978 by leaders of the Philadelphia Bar Association, community education is part of its mission.
“We have served over 400,000 seniors 60 and older throughout Pennsylvania,” SeniorLaw Center states on its website.
Tipton generally tailors topics and talks based on feedback from attendees.
“They find it to be helpful and sometimes it triggers things they should be putting their focus on,” she said.
Tipton noted that just as laws change over time, the same goes for people’s lives.
“They could be in independent living and then all of a sudden a medical issue comes up and they have to look at things differently,” Tipton said.
A primary concern she sees is a worry about financial security.
“They have to look and question if they have enough to make it to 90,” she said. “They also need to learn how to look at their Social Security.”
According to AARP, Social Security payments will increase by 3.2% as the 2024 cost-of-living adjustment takes effect.
“The estimated average retirement benefit will go up by $59 a month, from $1,848 to $1,907,” AARP states on its website.
Given the wide variety of backgrounds and professions among those who attend the Senior Center, Tipton explained that each person’s situation is unique, so the topics covered in the talks are meant to address various circumstances.
“They talk to them about how you take your 401(k) or IRA distribution,” she said. “Some people have teaching pensions or government pensions.”
The Senior Center’s next scheduled discussion will take place on April 10. No advance registration is necessary to attend.
“We’ll have someone from Northwestern Mutual in Radnor coming here, and they’ll talk about Social Security benefits and retirement,” Tipton said.
The presentation called “Social Security, Retirement Benefits and Advanced Retirement Concepts,” is available to everyone and will have time for questions.
“They suggested that it might be a good idea for the adult children of our senior citizens in their 50s to attend, because it's important to understand how these things work,” she explained. She added that the center recommends the presentation for those who are 60 years old and above.
Tipton has noticed that some older women have spent most of their lives in a situation where their husband, who has passed away, was the one responsible for managing all the money in the household. She is preparing to discuss this topic in an upcoming presentation.
“We will have a lawyer come in and talk about financial planning for women,” she said. “It will include information about managing finances as they get older.”
More details
Resources
• West Chester Area Senior Center, 530 E. Union Street, West Chester, 610-431-4242, www.wcseniors.org
• SeniorLAW Center: www.seniorlawcenter.org
7 changes in 2024 that impact retirement finances
• Social Security payments: Social Security recipients will see their monthly payments increase by 3.2% due to the 2024 cost-of-living adjustment (COLA).
• Medicare costs: After decreasing by 3% in 2023, standard premiums for Medicare Part B are going up again in 2024, from $164.90 to $174.70 per month, a 6% increase.
• Retirement plan contributions: If you are 50 or older, you can contribute up to $8,000 to an individual retirement account (IRA) for the 2024 tax year. This includes the $1,000 catch-up contribution available to older savers. The limit for people under 50 is $7,000. In both cases, the contribution limit has been raised by $500 from 2023. (You can still make your contributions for the 2023 tax year — the deadline is April 15.)
• RMDs: Required minimum distributions (RMDs) are a necessity in later life for holders of most types of retirement savings accounts. Roth IRAs are the exception, as they are not subject to annual required withdrawals while the owner is alive. Starting with the 2024 tax year, this exception will also apply to Roth 401(k) and 403(b) accounts.
• Standard tax deduction: If you or your spouse is 65 or older, you will receive a larger standard deduction. For single filers or heads of household, it will be $1,850 more (up from $1,750 for the 2022 tax year), and for couples filing jointly, it will be $3,000 more (up from $2,800).
• Full retirement age: In 1983, Congress voted to gradually raise the Social Security full retirement age (FRA) from 65 to 67. After four decades, the change is nearly complete, with FRA reaching 66 and 8 months in the latter half of 2024. You can start collecting retirement benefits before FRA — the minimum age is 62 — but your monthly payment will be permanently reduced, by as much as 30%. You can also wait past FRA and receive Social Security’s bonus for delaying benefits — an extra 8% a year until age 70.
• Social Security earnings test: If you claim Social Security retirement benefits before reaching FRA and continue to work, your benefits may be temporarily reduced. This depends on whether your annual income from work exceeds a set limit called the earnings test. For 2024, that limit increases from $21,240 to $22,320 for beneficiaries who will not reach FRA until a later year. Social Security withholds $1 in benefits for every $2 in earnings above the cap.
Source: www.aarp.org
