Estate Planning When Retirement Is on the Horizon

You’ve spent the better part of your career building retirement accounts, growing investments, and accumulating the assets that are supposed to fund the next chapter. But as retirement gets closer, the focus can naturally shift from building wealth to protecting it, coordinating it, and making sure the right people and the right instructions are in place if something happens to you, and that’s what estate planning is really about.

According to Caring.com’s 2025 Wills and Estate Planning Study, only about one in four American adults has a will, and more than half have no estate planning documents at all. If you’re approaching retirement with documents that were drafted when your kids were in elementary school — or with no documents at all — now is the time to get this right.

Your Beneficiary Designations May Be Running the Show

Here’s something that surprises many people: for a large portion of your wealth, your will has no say in where it goes. Retirement accounts — 401(k)s, IRAs, Roth IRAs — along with life insurance policies, annuities, and any account with a transfer-on-death or payable-on-death designation, all pass directly to whoever is named on the beneficiary form. These designations override your will, your trust, and your intentions, no matter what any other document says. For someone approaching retirement, this is often where the largest concentration of wealth sits — and it’s also where some of the most consequential mistakes hide. A beneficiary form that still names an ex-spouse. A contingent beneficiary line left blank. A retirement account with no beneficiary at all, defaulting to your estate and possibly getting dragged through probate.

There’s another layer worth being aware of. The SECURE Act changed the rules for how non-spouse beneficiaries inherit retirement accounts. Under previous rules, a child or other heir could stretch distributions over their own lifetime. That’s no longer the case for most non-spouse beneficiaries — the account generally must be fully distributed within ten years of the original owner’s death, which can create a significant and concentrated tax burden for heirs. How your designations are structured — and how they interact with your broader estate and tax plan — is something worth reviewing with your financial advisor and estate planning attorney together.

A simple check that’s easy to overlook: Pull the beneficiary forms for every retirement account, insurance policy, and TOD/POD account you own. Confirm that the primary and contingent beneficiaries reflect your current wishes. If any form is more than a few years old or predates a major life event, it’s time to update it.

Incapacity Planning Isn’t Abstract Anymore

When you’re thirty-five, the idea that someone else might need to manage your finances feels distant. When you’re approaching retirement, it becomes one of the most important things to have in place — because you’re about to depend on your portfolio for income. If a health event takes you out of the picture for weeks or months and no one has legal authority to access your accounts, manage your investments, or file your taxes, your retirement plan doesn’t just pause — it may be actively harmed. Your family may have to petition a court for conservatorship just to pay your mortgage, and that process can take months.

A durable power of attorney gives someone you trust the legal authority to handle your financial and legal affairs if you can’t. A living will and a medical power of attorney work together on the healthcare side — the living will outlines your wishes for medical treatment typically in end-of-life or terminal situations, and the medical power of attorney names someone to make healthcare decisions on your behalf when you can’t communicate. For someone about to rely on a carefully constructed retirement income plan, these documents aren’t just important — they’re essential infrastructure.

The Surviving Spouse Problem

This is a conversation many couples avoid, but it has real financial consequences. When one spouse passes away, the surviving spouse doesn’t just lose a partner — they often lose income and gain a higher tax rate at the same time. Social Security benefits are reduced to the higher of the two, pension income may decrease or stop depending on the payout option selected, and the surviving spouse typically moves to single filer status with narrower tax brackets.

Strategies like Roth conversions, life insurance structured to replace lost income, and pension payout elections that account for a surviving spouse’s needs can all provide meaningful protection. But they need to be evaluated in the context of the full financial picture — which is exactly the kind of analysis that benefits from a financial advisor and estate planning attorney working together.

Trusts, Wills, and What You Actually Need

Most people approaching retirement should consider, at minimum, an updated will, a revocable living trust (depending on their state and circumstances), durable financial and medical powers of attorney, and a living will. Some situations call for additional trust structures — asset protection, estate tax planning, providing for a family member with special needs — but those are highly specific and should be evaluated by an estate planning attorney who understands your full picture and your state’s laws.

The key point isn’t to become an expert on every type of trust. It’s to know these tools exist, that they solve specific problems, and that the right professional can help you determine which ones apply to your situation. One common mistake worth mentioning: a trust only works if it’s actually funded. Setting up a revocable living trust but never retitling your accounts into it is like buying a fire extinguisher and leaving it in the box — and it’s one of the most valuable places for your financial advisor and attorney to coordinate directly.

How Your Assets Are Titled Matters More Than You Think

The legal ownership structure of each asset — individual ownership, joint tenancy, trust ownership, community property — determines whether that asset goes through probate, passes automatically to a surviving owner, follows a beneficiary designation, or flows through your trust. If your estate plan says one thing but your account titling says another, the titling wins. A brokerage account that was supposed to be in your trust but is still titled in your individual name could go through probate. A bank account with your adult child added as a joint owner “for convenience” means they legally own half — and it could be exposed to their creditors or a divorce settlement.

After any estate planning work, it’s worth reviewing the titling on every account, deed, and policy to make sure everything matches the plan. A financial advisor can add real value here — systematically reviewing account registrations and flagging anything that doesn’t align with the estate plan’s intent.

The Pre-Retirement Window Is a Planning Opportunity

For many people, the years between retirement and the onset of Social Security and required minimum distributions represent a unique planning window. Income may be lower, tax brackets may be more favorable, and there’s an opportunity to make strategic moves — Roth conversions, gifting, trust funding — that can benefit both the estate plan and the long-term tax picture. These decisions sit at the intersection of estate planning, tax planning, and retirement income planning, and they’re a perfect example of why having your professionals communicating with each other produces better outcomes than any one of them working alone.

The Team That Makes It Work

A financial advisor — such as a CFP® professional — is not an attorney and cannot provide legal advice or draft legal documents. That’s the estate planning attorney’s role. What a financial advisor brings is a deep understanding of your overall financial picture: your income sources, your tax situation, your retirement timeline, your goals, and how all of your accounts and assets fit together.

The most effective estate planning happens when these professionals work together (ideally with a tax professional in the mix as well). Your financial advisor can help you identify what needs to be addressed and how estate planning decisions interact with your retirement goals. Your attorney translates those goals into legally sound strategies and documents. Each might see something the other doesn’t, and the best outcomes tend to come from that collaboration.

Pulling It All Together

If you’re nearing retirement, the most important thing to recognize is that estate planning isn’t a separate project from retirement planning — they’re deeply connected. You don’t need to become an expert on any of these topics, but asking the right questions, and working with professionals who see the full picture, can help ensure the individual pieces of your plan are pointing in the same direction. Your savings, your home, your investments — they represent decades of effort. Getting the estate plan right is how you make sure all of it is protected and that the people you care about are taken care of.

Tad Jakes, CFP®, EA, ECA

Disclosures

This article is for educational and informational purposes only and does not constitute legal, tax, or financial advice. Estate planning laws vary by state and individual circumstance. Always consult a qualified estate planning attorney, tax professional, and financial advisor regarding your specific situation.

Sources: Caring.com 2025 Wills and Estate Planning Study; IRS Publication 590-B; SECURE Act of 2019.sdfsdfg