Estate planning - it's not one of the most exciting topics to cover but is necessary. Tax planning, legal documents, investments need to be reviewed. I'm going to cover something else: organization.
Yes, simply organization. For married clients, typically one of the spouses handles investments, billing, taxes, and other business matters. It is the same in my household; Ioana (my lovely wife) knows who our local bank is, but likely would have to dig through files or piles of papers to find whom our investments are with or mortgage. Is this a problem? Only if I am not organized. With single individuals, the executor or power of attorney likely is unaware of minor details.
1. Create a financial inventory listing all accounts, including debt, investments, bills to pay, insurance, and any other critical item. If you can think of it, include it. Add important contacts, including estate attorneys, accountant, financial advisor, and insurance agent. If you have other important notes, include these, especially items where you receive emails/electronic statement.
2. Ensure your legal documents are in order, and include copies with the financial inventory.
3. Review these items with critical members of your family or estate team. With married couples, these documents are usually reviewed with the other spouse, but not children or executors. Ideally these would be reviewed with children or your trusted executor. Who else wants to review estate documents and accounts over thanksgiving dinner? Ok, perhaps that is not the best timing.
4. Place these documents in a secure location, either a safe deposit box or small safe. There are plenty decent options for under $75 - as long it can be installed permanently and fireproof, it should be good enough to keep items secure, and safe deposit boxes are worth the cost if you are concerned with theft.
5. Review these documents whenever there is a significant change and every February 1. Why not at the end/beginning of the year? Because that is a busy enough time to worry about estate needs! The date does not matter - just make it consistent.
In the end, if something were to happen to you tomorrow this packet should have all of your important to allow your family or trusted executor to easily handle your business items.
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Disclaimer: Information on this website and blog do not involve the rendering of personalized investment advice. A professional advisor should be consulted before implementing any of the options presented. No content should be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation.