BOSTON (CBS) – Fidelity’s 2014 Intra-Family Generational Finance Study found that many families are struggling with the difficult conversations about finances. And those that have had a conversation have not gotten enough details.
We could have told them the very same thing and saved them a bundle of money! Estate Planning is an awkward subject to discuss for it involves someone dying!
You may be one of the lucky ones and dad has already done everything needed and will tell you where the papers are. If not, start with some casual comments. Mention to him that you heard this financial planner on the radio and you realize you need to get your affairs in order.
Ask what he has done to get his affairs in order. If he says “nothing”, offer to help referring to the documents I have listed. If he says “yes”, ask where the documents are.
Estate planning does not need to be complicated. A will allows you to give your assets, the stuff you own, to your heirs. If there is a complicated situation, such as second or third marriage with kids from each marriage or lots of money involved, then you need to do some fancy estate planning.
A living trust you use while you are alive and upon your death your assets are distributed to your beneficiaries by your trustee and bypasses the probate process. This makes it very easy on the heirs and avoids any publicity.
Naming someone as the beneficiary of your IRA, retirement plan, insurance policy or annuity also supersedes the will and bypasses the probate process.
A Durable Power of Attorney is a legal document used while one is still alive. It allows you to choose someone to act as your attorney-in-fact to make decisions legally or financially if you are not able to do so.
A Medical Directive allows you to tell the medical community how you want to be treated if you cannot make medical decisions for yourself. In Massachusetts it is a Health Care Proxy, which allows you to choose someone to make those decisions for you.
One more thing: a new book: Check List for my Family: a Guide to my History, Financial Plans and Final Wishes, helps you put your life in order by gathering in one place your online accounts. Finances, legal documents, wishes about medical care and more. It tells you what you need and why and what’s missing and where to get it. Available at AARP, bookstores or Amazon.