April 9, 2009, 5:00 am

What You Need To Do Before You Go

by: The Financial Blogger    Category: Financial Planning
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before-you-goI’m like everybody; I don’t really like to talk about death. However, I see it too often in my day job that people are not prepared to go. They rarely have a will, and are not really aware of what will need to be done in the case of a death in the family. Unfortunately, there is one thing we are 100% about life; it has an end for everybody.

I have already wrote a series on estate planning (please see the links at the bottom of this post) but today I wanted to write more precisely what needs to be thought about or done with your relatives before you go. It’s like going away for vacation, someone has to take care of your dog and water your plants 😉

Make sure your spouse knows everything

When I say that your spouse must know everything, I am not talking about the skeletons in your closet… simply that she/he must know about important documents such as:

– Your Will

– Your bank account

– Payments going through on a automatic basis

– Your investment account

– Debts (credit cards, lines of credit, etc.)

– Mortgage documents and deed of house

Make sure you have a backup besides your spouse

You definitely need someone else you know that is aware of your personal finance so that he can help your spouse or directly take care of some of your stuff if both of you pass away. It is also preferable that this person is familiar with finance so he can provide advices. If you don’t have anybody, you are better off giving this responsibility to your notary or your financial planner so they can help your spouse going through all the paperwork.

Make a quick list of what needs to be done

This advice is good especially for people who are taking care of the budget and everything related to personal finance in their household. I realized that when I noticed that my wife didn’t even know how my Smith manoeuvre investments were made through our line of credit and that she didn’t really look at how our financial plan is setup. So if I die tomorrow morning, she will receive a good lump sum from my life insurance but it doesn’t mean that she will know what to do with it!

This is why it could be useful to write down the first 5 financial steps to do with the life insurance money or the estate. Here are a few examples of things that could be done to ease the process;

– Pay off the mortgage or all other debts with the life insurance.

– Do not close the line of credit; ask to transfer the existing line of credit under your name.

– Invest X amount for kid’s education. Ask my financial planner or X person on how you should invest it. Since they are young, it is ok to take a few risks (not invest everything in GIC right away).

– Open a separate bank account while the estate is being settled (joint accounts remain frozen until estate settlement).

– X money invested would be reasonable to assure a good retirement.

– Here’s a new budget considering that I am not there anymore, review it with a financial planner to make sure it is right.

So now that you are ready, you can go… to work 😉 You still have a great life to live ahead, have a good day!

image source: national geographic

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“Make sure you have a backup for your spouse”

Why did I read this as “Make sure you have a backup spouse”? Must be the day before a long weekend!

Anyways, I will definitely be reading your series on estate planning. We don’t have wills or life insurance. Now that I’m married, moving into a new house, and a child on the way I plan on taking care of both of these soon.

This is a really great topic to bring up from time to time. You never know when these plannings will come in handy. Another case of better safe than sorry!

Nice article..Completely agree that nomination facility is as important as the investment itslef.. while everyone does give his investment a lot of time and effort , people generally are lax at sharing their nomination details withe near and dear ones…

I suggest that one needs to keep atleast both his parents in loop besides spouse on this.

by: The Financial Blogger | April 9th, 2009 (3:17 pm)

Canadian Finance,
thx for pointing that ou!
I’m sure that my wife would not be super happy to see how I “plan” to get a backup “for” her 😉

Yeah, and my wife wouldn’t be to happy that I immediately thought of it that way!

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Hey FB, How much should a will cost?

Wife and I are just going through the process for the first time, since we just have our third child. The lawyer we found is charging about $500 per person, so $1000 total. I thought that, for that amount, they would have a lot more advice. He did have some things to say and gave me some articles to read, but it was pretty pedestrian. There was not much advice regarding taxes or other financial optimization.

On the other side it was a little eye opening how me and my family reacted to some of the questions. Who would I want to raise my kids if me and the wife died? And do they want that responsibility? Interesting.

The price seems right. Depending on the notary, you get can a few or a lot of advices. Unfortunately, it is like dealing with a financial advisor… there are are few clowns;-)

It may lead to a lot of discussion thinking about who you wish to take care of your children in “the worst case scenario”.

Congratulation on being responsible 😉

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