No one enjoys talking about their eventual demise—much less planning for it! But no matter how uncomfortable this topic is to address, you’ll be doing your family a favor by getting your affairs in order before a tragic event occurs.
Studies have shown that the death of a loved one is among the most stressful events a person can experience. (1) Grief can profoundly impact our decision-making skills—and not for the better—so making decisions ahead of time and having a plan to take care of the details can ease some of the stress in a time of grief. Here are a few tips to make sure everything is in place should an unexpected death of a loved one occur.
A will isn’t for those on their deathbed; it’s for everyone. Unfortunately, around 54% of Americans don’t have a will, (2) and barely half of those over 55 have taken the time to create a will. (3) Your will outlines what happens with your property and dictates guardianship of your children. It also names your executor, who will carry out your wishes. You don’t want to leave these decisions to the State, which is what will happen if you don’t have a will. Make sure your spouse or other family members know how to access your will when the time comes, and remember to review it regularly to ensure it is up to date.
Do you have an organized filing system, or are all your important documents strewn about in different places?
We recommend putting together a “Big Red Binder” (a reference book that includes crucial data that loved ones will need in the event of a sudden death or illness) so that survivors can easily access and identify all assets, financial professional contacts, and other important information in one place.
Don’t rely on digital only. If family members can’t get into your computer or access your cloud storage, they won’t be able to help. Paper is easily accessed, photocopied, faxed, scanned, and shared as needed. Tell at least two trusted people where they can easily find it. Better yet, give them each a copy, especially if they live far away.
We recommend including the following documents in the binder:
In addition to the above important documents, we also recommend including the following information:
A personal binder like this relieves family and friends (who are likely still in shock) and gives them the ability to have the information they need right at their fingertips without having to dig through files or drawers of paper. It’s a gift to those you love.
Surviving family members may be entitled to certain benefits, such as Social Security and/or pension benefits, life insurance, and annuities. List out all the details pertaining to each benefit and communicate these to your family. Be sure to include the following:
Finances can get messy when someone dies. You don’t want your family scrambling for money or unable to access account information. They will have enough stress to deal with already, so save them the trouble by making a list of all your financial accounts, including the name of the bank/institution, account number, type of account, name on the account, and contact information.
Don’t forget about debts. Most of your debts won’t go away just because you do. Your spouse MAY be responsible for taking over your debts, so do your best to prevent missed payments that could damage credit and cause undue stress. For every debt, communicate the creditor’s name, outstanding balance, name on the debt, loan terms, and the amount, timing, and method of payments.
Make sure your spouse is familiar with recurring household expenses, such as utilities, and how and when to pay them.
Finally, provide contact information for your financial advisor, insurance agent, attorney, and accountant. These professionals are trained to know how to handle an unexpected death, and they will be able to direct your loved ones to the right sources of information and help them make the best decisions possible.
When was the last time you reviewed your insurance policies? You most likely purchased insurance to protect those you love, so do your due diligence and verify that the various policies are current and beneficiary information is correct.
In addition to the life insurance payout that your family will receive, have all the details for your other policies in an easy-to-find spot. Your spouse will need to contact the companies to cancel or update the policies. This includes medical, dental, auto, long-term care, and homeowners, to name a few.
An important part of developing a plan for your spouse to move forward alone will involve communicating your current spending needs. If you don’t already have a written budget, begin tracking your expenses and create one. It will be an incredible aid when planning for the future.
Having a support system with expertise in these areas will make your planning process simpler. Take the time now to build a relationship with an advisor and make sure your spouse and family members are involved so that if the unexpected happens, they have someone they can trust to help them handle matters. Financial professionals are experienced with these situations and can guide you through the steps that apply to your unique circumstances. They will not only help you take care of pressing problems and concerns but can also help you feel more secure in a time of financial change. A financial advisor can make sure your affairs are in order, update your financial plan, and implement appropriate strategies to help you stay on track financially.
We at Wealth Advocate Group believe it’s worth your time to prepare for an unexpected death before it happens. If you partner with us, we will work to prepare your finances for any situation and every stage of life. Advocating for what’s most important to you, we focus on financial education, meticulous planning, and clear guidance for your family and your future.
As you start preparing for an unexpected death, we are here to answer any questions you may have. Call 440-505-5704 or email jbrown@Wadvocate.com to schedule an appointment.
John Brown is a wealth advisor at Wealth Advocate Group, LLC, an independent, fee-based wealth management company. With over 10 years of experience in the financial industry and a background in accounting, John provides sophisticated and specialized services to his senior executive clients who need the expertise of someone well-versed in concentrated securities, stock options, and restricted stock strategies, as well as the risk and tax burdens that come along with their compensation. John has a bachelor’s degree in accounting and financial management from Hillsdale College and is a CERTIFIED FINANCIAL PLANNER® professional. John is known for his thorough approach, often asking questions and bringing up details his clients have not considered. He strives to address every piece of his clients’ financial picture to make sure they are on the path toward their goals and financial confidence. In his spare time, John and his wife, Christina, enjoy traveling and staying active. You can often find him spending quality time with his friends and family. To learn more about John, connect with him on LinkedIn.
The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. You should discuss your specific situation with the appropriate professional.
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(1) https://www.verywellmind.com/decisions-to-delay-if-youre-grieving-4065127
(2) https://news.gallup.com/poll/351500/how-many-americans-have-will.aspx
(3) https://mlaem.fs.ml.com/content/dam/ML/Articles/pdf/ml_LegacyStudy_Final.pdf
