You might be blissfully married and have avoided any talk of a time when its a ‘then there was one’ situation but it is a fact of life. Another fact of life is that taxes become a huge enemy in this wrinkle in time. So how do you prepare for what lies ahead? One option is to switch from a deferred tax IRA to an after tax Roth IRA. Which means paying now with a lower rate but with the Roth account growing tax free. You can also transfer money into a long term life insurance policy which will also give you funds for obligations such as nursing homes or situations of this nature.
Key Takeaways:
- If you are not prepared for the tax changes that come with being widowed, you may be faced with a much larger tax bill.
- If you have saved a lot of your money in an IRA, you will eventually owe a lot of that money to the IRS.
- Investing in a long-term care policy might be wise, as costs of nursing care keep going up.
“at some point we have to discuss the uncomfortable truth that someday — hopefully far down the road — one of them will be widowed.”
