In most households, one person pays the bills and the other person hopes that things are being handled correctly. All too often, when the bill-payer passes away unexpectedly, the spouse or children who are left behind must scramble to figure out how to pay utility bills, locate assets, figure out who the insurance agent is, etc. What is already a difficult time becomes a bureaucratic nightmare. Consider this: without account passwords, you can’t pay an electric bill. What if the lights go out because no one could access the account information? The final frontier of estate planning is sharing this day-to-day practical information so as not to add to the burdens of those who are left behind.
Parts of estate planning that is usually not considered was highlighted in “Estate planning details you may be forgetting”in The Ledger. This practical checklist includes necessary information that needs to be discussed and, most importantly, shared with family members. This includes:
1. Organize financial documents and personal information. Leaving behind organized records with everything from account information to contact numbers will help your spouse or children when they need access to this information. Make certain your spouse knows where you keep things such as wills, trust documents, insurance information, social security cards, birth certificates, medical records, and tax information. Write the names and contact information of emergency contacts and include your doctors, attorney, and insurance agent.
2. Create a list of assets and liabilities. Assets should include bank accounts, brokerage accounts, safety deposit boxes, and property. Liabilities should include things like credit card debts, mortgages, and car payments. List the location, names on the accounts, account numbers, and any website login information including usernames, passwords, and security questions for each one.
3. Identify all sources of income and expenses. This will help your spouse understand what in-flows to expect, as well the bills to be paid. Note whether you pay a bill by paper or online, and if online, list the usernames, passwords, and security information to access the websites.
4. Document any other miscellaneous information that your spouse might need. While this might not be financial planning, it is still very important. This includes things like where you keep the spare keys to your house, or any keys to the shed or safes. As you go through your daily routine, consider things that are obvious to you, but may not be as obvious to your spouse or children. This should include a list of passwords for online accounts, passwords for computers and other electronic devices, locations of flash drives or CDs with old family pictures—even a basic household maintenance checklist.
Detailed planning will result in the peace of mind for your spouse and family in the event of your death or incapacitation.
Sit down with an experienced estate planning attorney to get some help with planning for these and other life events.
Reference: The Ledger (September 17, 2015) “Estate planning details you may be forgetting”