How Should Someone in Her 80s Have Her Money Invested?
- 1). Total your monthly expenses and annualize them by multiplying the monthly expense by 12. Include all expenses such as food, utilities, insurance and mortgage payments. Add to the annualized expenses your intermittent costs through the year such as property taxes.
- 2). Multiply your assets by eight. According to an article by Tara Siegel Bernard in "The New York Times," advisors recommend retirees have eight to 15 years of expenses held in cash or bonds.
- 3). Check your savings to make sure you have the adequate liquidity needs according to the eight-year calculation. Place this money in savings, time certificates, treasury and corporate bonds. People in a high tax bracket can also look at tax-free municipal bonds.
- 4). Place assets over the required savings suggestion in moderate stocks or variable annuities. Check with insurance providers who accept older investors for deferred annuity investments that defer taxes, avoid probate and may have riders for liquidity and asset protection, if long-term care is needed.
- 5). Consider life insurance policies as a part of estate planning. Large estates with federal transfer tax issues can benefit from life insurance which goes to beneficiaries tax free. The life insurance pays the tax bill allowing, beneficiaries to receive the full estate value.
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