Take it From Me, Creating a Smart End Of Life Plan is Something Your Family Will Always Remember
January 14th, 2010 Filed under: ab trust,Executor Fees,sample wills,Trusts attorney — Estate Planning Author
Start the New Year Off By Improving Your Financial Plan – Add an End-of-Life Plan Using Two Easy Steps:
1. Complete a Family Record Guide
2. Create a “Love Drawer”
Many financial professionals refer to life insurance as “love insurance”. As cliche as it may sound, it certainly has a tremendous amount of merit. What better end-of-life gift can you give your family and loved ones than a large sum of money that can be used for income replacement, college tuition, retirement, taxes or estate taxes, charitable gifts, and much more? The key point here is that the last thing any of us should want to add to our families during a time of such emotional loss and grieving are any unnecessary financial and emotional pressures.
Financial Planning Involves Using Protective Tools and Strategies
Financial tools such as life insurance, Wills and Trusts, Long-Term Care, etc., each play an integral part in most families financial lives, I also believe there are other aspects of financial planning that are equally, if not more important.
Here is a short list of some of the key reasons why I’ve become so passionate about this issue::
1. With more than 23 years experience as a financial advisor, the sad truth is more than 70% of people who die end up leaving their families without so much as a basic Last Will and Testament.
2. I have worked with families after they have lost a loved one
3. I recently lost my mother and personally experienced what many families go through every day
4. I firmly believe that end-of-life planning needs to be openly discussed as necessary part of a comprehensive financial plan, for every family.
The truth is most financial professionals and families tend to minimize, overlook, and/or ignore the importance of incorporating two additional key pieces of building a successful comprehensive financial plan.
Step 1 – Complete a Family Record Guide
1. Studies prove that most people have not created a written end-of-life plan, which includes of all of your necessary final arrangements. This can easily be accomplished by obtaining and completing a Family Record Guide, which a written document containing the full details of your end-of-life plans and preferences, such as your burial wishes, financial matters, bequests, last wishes, funeral insurance, etc.
Step 2 – Build a “Love Drawer”
2. Studies also proved that very few people have created another wonderful and overlooked gift of love, which I commonly refer to as the family “love drawer”.
So What Exactly is a “Love Drawer”?
In the funeral industry, the written or documented version of this “love drawer” is commonly referred to as a Family Record Guide. However, my definition of the physical “love drawer” is the actual place someone can turn to in the event that something unexpectedly happens to you. Since the unfortunate reality is that each of us runs the risk of dying unexpectedly every day, this “love drawer” serves as the key place where someone you trust can turn to and access the whereabouts of your complete financial details, records, and end-of-life plans.
So what are some financial and end-of-life matters that are usually included in this “love drawer”? Some of the key pieces that need to be included in your end-of-life plan include your estate planning details (attorney, location, etc.), insurance policy details, IRA’s, life insurance, investment accounts, bank accounts, employer contact information, Social Security Administration statements and contact information, any debts, birth certificates, drivers license, passport, deeds or titles, pre-planning details (burial wishes, preferences, location, etc.), final notes, wishes, or letters to loved ones, as well as any funeral insurance designed to cover your end-of-life expenses.
YOU NEED BOTH
The key point to make here is that completing a Family Record Guide and “love drawer” are two totally separate, and yet equally important, pieces of creating a smart end-of-life plan. In other words, a comprehensive end-of-life plan can only be considered completed once you have both documented your end-of-life plans and gathered all of these various details and instructions together into one identifiable location.
I also strongly suggest you inform at least three people that you love and trust, regarding the whereabouts (the actual physical location) of your the final version of your Family Record Guide and “love drawer”. These loved ones could include your spouse, parents, children, friends, or even your financial advisor or attorney. In addition, even though it may seem obvious, I would ask them to please respect your privacy and never access any of this information until it is absolutely necessary. These entrusted loved ones will be the ones who help ensure that someone will be there to step up promptly and act upon the details and instructions of your end-of-life plan.
Oh, and one final piece of advice is be sure to update your end-of life plan at least every two years. One of the only guarantees we have in life is that things will change. Life contains so many constantly moving parts like taxes, estate taxes, family, age, health, wealth, our final wishes, etc. Therefore, we need to continue to review and revise our financial affairs on a regular basis. Regularly updating your end-of-life plan can reflect any important financial matters that need to be added, revised, or need to be removed.
Nothing Good Comes Easy
One of my favorite quotes of all-time is from the legendary football coach Vince Lombardi, who said, “The difference between failure and success is largely determined by the amount of time and preparation put into preparing for the future.”
Regardless of how many hours this may take, I am fully confident that once you have finalized both your Family Record Guide and your “love drawer”, you will consider this to be time well spent for you and your family.
Key Benefits For You and Your Family
For you, you will experience a tremendous peace of mind knowing that your loved ones can easily handle all of your financial affairs without any unnecessary financial pressures, confusion, or disagreements.
For your loved ones, they will have the gift of being able to remember you in a way that you would want, which is kind, generous, giving, and thoughtful. More importantly, it can eliminate many of the emotional and financial pressures surrounding such a difficult time, and allow them to focus on what is most important, which is celebrating the wonderful legacy and memories of your life.
Christopher P. Hill, Founder
http://www.funeralresources.com/pre-planning-a-funeral/your-three-best-ways-to-pre-arrange-your-funeral/
http://www.funeralresources.com/pre-planning-a-funeral/creating-a-love-drawer/
