While Confident They'll Manage Financially, Four in 10 Americans Don't Have a Financial Plan if Separated or Widowed Later in...
February 18 2020 - 8:30AM
Business Wire
New TD Ameritrade survey highlights Americans’
financial approach to relationships and estate planning
With the average life expectancy reaching nearly 79 years old,1
Americans are living longer than previous generations. But with
that extra time, are they planning accordingly for it, especially
when it comes to the loss of a partner? While confident they can
manage financially if separated or widowed later in life, many
Americans age 40 and older don’t have a corresponding financial
plan in place, according to a new survey conducted by The Harris
Poll on behalf of TD Ameritrade.
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The impact of divorce on Americans'
retirement (Graphic: TD Ameritrade)
“Planning your finances around the potential end of a
relationship due to divorce or death can be uncomfortable at the
very least,” said Keith Denerstein, director of investment products
and guidance at TD Ameritrade. “While the trepidation is
understandable, preparing for these possible scenarios is important
for future financial security, and therefore should be a key part
of financial planning.”
Americans say they’re prepared for being divorced or widowed,
but are they?
- Most Americans (87%) age 40 and older are confident in their
ability to manage their own financial situation in the event of a
divorce or a spouse passing away later in life.
- Four in 10 (41%) do not have a financial plan in place in the
event of a divorce or becoming widowed, with men (45%) being more
unprepared than women (36%).
What about prenups?
- Most Americans (94%) age 40 and older do not have a prenuptial
agreement in place, including 91% of those with $250k+ in
investable assets.
Once bitten, twice shy Many divorcees say divorce
impacted their ability to retire, especially men.
- Forty percent of divorcees agreed that getting divorced threw
their retirement plans off course (46% of men compared to 36% of
women).
- Forty percent have less than $50K saved for retirement,
compared to 32% of Americans overall in a similar age bracket.
- Thirty-three percent delayed their divorce longer than they
wanted due to financial concerns.
- While most divorcees did not have a prenup in their previous
marriage (97%), four in 10 (42%) say they would get one if they
remarried.
- Among those with $250k+ in investable assets, the percentage
rises to 70%.
- Three in four (75%) also say that agreement should include
retirement assets.
Among those who are married, combined retirement plans are also
murky.
- Half (48%) say they expect to have a different retirement
timeline than their partner, while only one in four (25%) say they
are very prepared if they or their spouse has to retire earlier
than expected.
What’s the right way to tackle end-of-life planning?
Regardless of relationship status, many aren’t sure how to approach
end-of-life planning with their families. This is especially true
for those in their 40s and 50s with more than half unsure how to
structure their inheritance.
- Not sure of the best way to structure an inheritance for their
family:
- Ages 40-49: 59%
- Ages 50-59: 48%
- Ages 60-69: 33%
- Ages 70-79: 27%
- Don't know how to discuss legacy planning with their family:
- Ages 40-49: 48%
- Ages 50-59: 34%
- Ages 60-69: 26%
- Ages 70-79: 20%
Only one in three have shared financial passwords in case of an
emergency. Even fewer have discussed inheritance planning and
long-term care plans.
- Discussed desired arrangements for my funeral with my family to
prevent debates about my wishes: 40%
- Told someone where to find relevant financial passwords in case
of an emergency: 36%
- Set aside money for end-of-life care (e.g., caretaking, funeral
arrangements): 30%
- Created an 'in case of emergency plan' in case something
happens to the household's primary financial decision maker:
28%
- Told my children how to access and manage my assets in case of
an emergency: 21%
- Discussed inheritance and legacy planning with my children:
20%
- Discussed health and caretaking planning with my children:
19%
“While it may be difficult to find the ‘right time,’ it’s
crucial to discuss issues like legacy and caretaking planning with
your spouse, children or extended family members,” said Denerstein.
“Planning ahead could provide a much needed boost in financial
security for loved ones who unexpectedly find themselves in these
situations.”
About TD Ameritrade Holding Corporation TD Ameritrade
provides investing services and education to approximately 12
million client accounts totaling approximately $1.4 trillion in
assets, and custodial services to more than 7,000 registered
investment advisors. We are a leader in U.S. retail trading,
executing an average of approximately 1 million trades per day for
our clients, more than a quarter of which come from mobile devices.
We have a proud history of innovation, dating back to our start in
1975, and today our team of nearly 10,000-strong is committed to
carrying it forward. Together, we are leveraging the latest in
cutting edge technologies and one-on-one client care to transform
lives, and investing, for the better. Learn more by visiting TD
Ameritrade’s newsroom at www.amtd.com, or read our stories at Fresh
Accounts.
Brokerage services provided by TD Ameritrade, Inc., member FINRA
(www.FINRA.org) / SIPC (www.SIPC.org)
Source: TD Ameritrade Holding Corporation
About The Harris Poll The Harris Poll is one of the
longest-running surveys in the U.S., tracking public opinion,
motivations and social sentiment since 1963. It is now part of
Harris Insights & Analytics, a global consulting and market
research firm that strives to reveal the authentic values of modern
society to inspire leaders to create a better tomorrow. We work
with clients in three primary areas; building twenty-first-century
corporate reputation, crafting brand strategy and performance
tracking, and earning organic media through public relations
research. Our mission is to provide insights and advisory to help
leaders make the best decisions possible. TD Ameritrade is separate
from and not affiliated with the Harris Poll, and is not
responsible for their services or policies.
Survey Methodology This survey was conducted online
within the United States by The Harris Poll on behalf of TD
Ameritrade from August 30 to September 10, 2019, among 2,000 U.S.
adults ages 40-79 with at least $25,000 in investable assets. The
audience was divided into four decades: 40-49 (n=500), 50-59
(n=500), 60-69 (n=500) and 70-79 (n=500).
1 https://www.cdc.gov/nchs/products/databriefs/db328.htm
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200218005035/en/
For Media: Tim Osiecki, 201-369-5908 Corporate Communications
timothy.osiecki@tdameritrade.com @TDAmeritradePR
For Investors: Jeff Goeser, 402-597-8464 Managing Director,
Investor Relations jeffrey.goeser@tdameritrade.com
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