Estate planning is not fun. You have to face what the world will be like after you leave it. You want to leave a legacy so your survivors are happy. However, less than one in five of you have taken the steps needed.
If you completely ignore creating a post-death plan, then you will leave a chaos and confusion for others to sort out at a time when they will be grieving from your loss. They will have to find where you put everything and sort out where you wanted everything to go.
If people depend on you financially, not providing enough on which they can survive will mean major lifestyle changes for them. Not something you want.
You want survivors to focus on cherished memories, not on probate courts. Take action!
Now, what do you do?
First, leave enough so survivors can survive
Make sure you have provided for those who depend on you. Usually, that means purchasing some form of life insurance. You want to replace your earning power from now until the time that they are independent, either when a spouse or partner retires or when your children become gainfully employed.
If you have been saving for retirement, those accounts may be enough so you don’t need to purchase life insurance. Reviewing your potential estate with an advisor is wise to make sure survivors have enough.
Second, sign the documents
Execute documents that ensure that your estate goes to the people who you want to benefit. This usually means signing beneficiary designations for retirement plan accounts and executing a will. You may even need a trust for young survivors. We wrote this post detailing the steps a few years back. If that’s too technical, ask me questions.
You may want to consult an advisor to get all the proper documents in place. Here is a good checklist to review.
Third, have the conversations
Talk to your spouse, to your adult children and to the people you name in your documents. Make sure they understand your wishes. Do you want to be buried or do you want to be cremated? Do you want donations made to charities?
What if you have a catastrophe the doesn’t kill you, but leaves you hooked up to machines forever? Have a conversation so your loved ones know your wishes. And, make sure you sign a health care proxy or medical directive, living will and even a “do not resuscitate” or DNR order.
Fourth, leave a trail
Make sure the key people know how to find everything. One way is to write a memorandum listing your passwords, where to find the safe deposit box key, and where you stored the life insurance policies. Give copes to key people, such as the personal representative named in you will or the trustee of your trust.
Finally, leave a legacy
When you take care of all you can, in advance, your survivors don’t have to suppress feelings while they clean up a mess:
“WE WERE WORRIED ABOUT MY MOM after my dad died, but he had everything in order. It allowed us to focus on our grief instead of being bogged down in financial paperwork and family bickering.” That’s one of the candid responses Merrill Lynch and Age Wave received when they interviewed more than 3,000 Americans 55 and older for a comprehensive look at attitudes and practices surrounding legacy planning. From How do you want to be remembered…
You will need to review and update your plan over time. But, just knowing you took all these steps should improve matters for you and your family now! Contact our office if you have questions so you can “don’t worry, be happy!”