As grim as it may sound, now is as good a time as any to plan your estate in case of death.
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Here’s something cheery to contemplate. Suppose tomorrow you’re hit by a bus/ 18-wheeler/SUV/exceptionally large bicycle. And die.
Are your affairs in order?
The new year has come and gone, along with many of our resolutions. But what do you really, really need to resolve to do? You need to prepare for your death.
You need a will (probably), you need advanced health care directives if you end up in the hospital, you need to leave your loved ones a list of instructions.
Where there’s a will
You can probably come up with any number of reasons not to write your will. It sounds intimidating. It sounds expensive. Worst of all, you actually have to think about dying.
Then again, don’t you want to be the one who decides who’ll raise your (minor) children in your absence? Who’ll get your collection of old TV Guides? (Not to mention possessions that are actually worth something.)
“It irks me when people take the attitude of ‘I’ll be dead, so why should I care?’ ” says Dan Mathews, a certified financial planner with Stepp & Rothwell Inc. in Overland Park, Kan., and a member of the Financial Planning Association of Greater Kansas City.
But it’s irresponsible, he says, not to have a plan in place for your estate.
“You want people to remember you for the good things you did, not the mess you left,” Mathews says.
Think you’re too young to have to worry about this? About one in eight of today’s 20-year-olds will die before reaching age 67, according to the Social Security Administration.
There are plenty of books and online resources on estate planning, but if you go the do-it-yourself route you should still consult a lawyer before executing a will. “There are too many pitfalls,” Mathews says, including laws that vary from state to state.
Where there’s a will substitute
It might take a chunk of time to list your assets, decide who gets them and then put it all down in a will. But there’s one thing you can do right now: Make sure you have beneficiaries on file for your life insurance policy, retirement accounts and the like.
If you have registered those beneficiaries already, make sure the names (and percentages each gets) are up-to-date after major life events.
Designating beneficiaries — with an insurance company or mutual funds company or whatever — is known as a will substitute, says financial adviser Barbara McMahon, president of Innovest Financial Partners in Kansas City.
“Registration rules,” she says. “It doesn’t matter what the will says.”
So, for instance, if a guy remarried but never changed the beneficiary of his 401(k) account from first wife to second wife, the first wife gets the dough if he dies — even if his will states otherwise.