Financial fix: Planning a legacy for heirs
January 3, 2011
CNN Money - As brave as Don must have been to fly missions in Vietnam (and face down a classroom full of sixth-graders), he isn't comfortable with the financial risk he's taking, says Deena Katz, a financial planner who also teaches at Texas Tech University.
Donald and Marguerite Marburger lead a comfortable life in retirement, but they still have financial worries.
They fret that their two children and their families, who live near them in the Dallas area, won't be as well off as they are.
More urgently, they worry that Marguerite, a retired schoolteacher, would struggle financially if Don, a former Air Force navigator and later a teacher himself, were to die first.
The loss of Don's full military pension and lower Social Security would leave Marguerite with half the income they bring in now (she'd still collect the teacher's pensions).
What's worse, Don, unnerved by the 2008 market decline, sold virtually all their stocks in October of that year and has been moving in and out of the market ever since.
Marguerite is concerned about Don's health, given the market-induced sleeplessness that Don, normally the calmer of the two, has suffered in recent years.
"I believe stress kills you," she says, "and at our age we don't need any."
Age: Marguerite, 64, and Donald, 67
Occupation: Both retired
Location: Rockwall, Texas
Income: $88,000
Assets: $978,000 in retirement savings; $20,000 in 529 plans (for four grandchildren)
Goals: Protect Marguerite's standard of living if Don predeceases her; leave a legacy for children and grandchildren
As brave as Don must have been to fly missions in Vietnam (and face down a classroom full of sixth-graders), he isn't comfortable with the financial risk he's taking, says Deena Katz, a financial planner who also teaches at Texas Tech University.