Preparing and organizing your financial information for when you are no longer capable will bring peace of mind to you today and relieve your loved ones’ burden in the future. It will ensure proper management of your financial situation and afford control over your end of life and legacy.
The goal is to make and maintain an accurate list of accounts and passwords and relevant contact names at financial institutions. Planners and books (“My Life Directory,” “I’m Dead. Now What?”) are available to help you understand the scope of the project and start the process of organizing all records and personal information. Whether you are a parent, near retirement, or both, informational instructions will spare your family a lot of work and heartache.
The assumption is that you already have an estate plan with necessary documents such as a will, living will, durable power of attorney and medical attorney, etc. If this is not the case, retain an attorney to create these most important legal documents. You can then focus your attention on the written steps your family should take if something happens to you.
These steps should include a list of all salient information; names (think bankers, lawyers, insurance agents) and their contact information, digital and hard assets, accounts, bills, debts, credit cards, insurance policies, annuities, pensions, PINs, and passwords. Include a list of all companies and invoice types (monthly, quarterly, annually) that automatically debit money from your checking account. This list is about anyone and anything that is part of your financial life.
The numerous books, planners, and online free worksheets can help you identify those things that need inclusion in your financial information; this can be your starting point. Online websites or apps can store your data and instructions for a one time or recurring fee. These sites are typically referred to as estate-planning organizers, end-of-life planners, document storage, even “death apps.”
While these options may sound intriguing, a self-directed approach is generally best. Turning over consolidated personal financial data opens you to the possibility of identity theft, hacking, misuse of your records, erasure, and loss using these services.
Digitize your information in a word editor or spreadsheet and store it on a flash drive. Print hard copies of your instructions and information and leave them with other important documents like your will or the deed to your home.
Are you low-tech? There is no shame in a binder or spiral notebook containing this information. It is a bit more cumbersome to update, but many people choose to leave instructions to family members in handwritten letters, notes, and notebooks. Be certain your handwritten instructions do not vary with multiple papers scattered and undated. Stick to a standard methodology and throw out old documents.
Keep these records accurate with annual updates or any fundamental shift in how your finances are managed and by whom. Be sure your executor and other relevant family members know the location of this information. If you want your wishes to remain private until you are incapacitated or die, seal flash drives and hard copies in envelopes.
Preparing your financial records for your family can be time-consuming, but it is not complicated. The true goal of this task is organization and consolidation. And it is one of the most important financial tasks you will undertake during your life.
When you feel your project is near completion (other than annual updates), ensure nothing is being overlooked by consulting an estate planning attorney, who will make sure you have all of the necessary legal documents in place. We provide these services and would be happy to talk with you about your planning needs.
— By Rebecca W. Geyer, Attorney at Rebecca W. Geyer & Associates