I was sitting in a meeting the other day, where the topic of discussion was life changes. Specifically, it was about how certain events in life have huge financial impact (birth, new job or job loss, marriage, divorce, retirement, disability, death). I instantly made a mental note: “must write an article about death and its financial impact on survivors.”
Fast forward a week… As I sit down to actually write this post, I have to be honest with you, I still don’t feel like I want to talk about death. Though it’s a fact of life, it’s way too depressing. But then, the more I think and talk about it, the stronger I feel that there is merit to writing about things that you should do while you are alive – things that your loved ones will be thankful for (especially when you’re no longer here.) If you’re lucky, they may even thank you while you’re still among the living.
When you Google “important things to do before you die,” there’s no shortage of advice served up by the Internet. “Plan your funeral,” says one article. “Assemble your team,” says another. “Notify the government.” Yes, do all those things.
But let me add a few other proactive steps you can take, while you are still here.
#1: Tell the people in your life that you love them.
I’ll keep this short and simple. If you love someone, let them know. Today. No delays, right away. And even if you’ve let them know, let them know again. One of the most intimate things you can share with a loved one is a personal letter. Write a letter to your children, to your spouse, to your parents and siblings, and/or your chosen family.
Personal letters or videos to loved ones are truly appreciated, especially when you are no longer here to deliver the message yourself.
#2: Pull your credit report and share it with the person who will be financially responsible when you are no longer around.
Set aside the emotional toll of losing someone, the administrative overhead of dealing with death is significant. We recently had a client who passed away, and the only way to figure out exactly what needed to be done next in terms of taking care of this person’s bills, obligations, etc. was to get a credit report for the deceased party.
Even though as financial planners we have a solid understanding of most of our clients’ financial obligations, only a credit report provides an exhaustive list of all the bank accounts, credit cards and other financial arrangements a person may have. You will need a social security number and validated email address in order to pull your credit report at a credit-monitoring provider like Credit Karma, for example.
Your loved ones will be grateful that collection agents won’t be hounding them (and you, into the beyond!). It’s bad enough to receive a bill that’s past due; it’s emotionally distressful to receive nasty letters addressed to a deceased loved one. Do your family a favor, and let them know what accounts are in your name.
#3: Keep an updated list of usernames and passwords for any accounts you use, and let your trusted financial ‘proxy’ know where to find them.
For the purposes of this article, it’s the financial sites that matter most, but it makes sense to save everything (including your social media logins) to a safe location that gets automatically updated when passwords change.
Speaking of keeping things safe, at our firm, we provide a secure online location (called the Vault) where we encourage our clients to keep copies of their most important documents, and other critical information that can be accessed in case of emergencies. Now, you’ll still need original copies of wills and other legal documents, but it helps to have scanned copies of everything stored in the Vault (or similar location). Another important list that belongs in a Vault is a list of all your insurance policies (life insurance, in particular.)
Your loved ones will appreciate not having to wrangle with companies trying to prove that they are indeed related to you, nor will you need to put them in the awkward position of going through your emails and other personal items to track down usernames and passwords. In short, you will save them a lot of time and anguish.
#4: Make sure your survivors know the names and contact information of all of your trusted advisors.
It’s really important that your family know whom to call in case something were to happen to you. Do they know your financial planner, your attorney, or your CPA? Make a list today of all the people to whom you turn for advice, and list their names, identify your relationships with them, and how they may be contacted.
Your loved ones will be grateful to be connected with professionals who knew you, advised you, and who understood what you desired in your life.
#5: Update your financial plan on an annual basis.
Of course I have to say this – I’m a financial planner! And besides it just makes sense. Updating your financial plan will ensure that your “affairs are in order,” and that you are prepared for any circumstance.
A good financial planner will regularly ask you about changes to your financial situation and recommend that you update your various assets, estate strategies, and other holdings accordingly. S/he will remind you to review your beneficiaries after a divorce, or the birth of a child, to adjust your will when you move from state to state, or to adjust your savings rate – and a whole lot more.
So go ahead and schedule that appointment with your financial planner – your loved ones will thank you for the thoughtfulness with which you led your life.
Jim Bode is Managing Partner at Beck Bode Wealth Management