No matter if you’re young and single, estate planning is still a necessity. The worst can happen at any time, and suddenly you’re faced with a life-threatening injury or illness. What happens to your finances then? It’s best to be prepared no matter what age you are or what stage of life you’re in.
To safeguard your money, it’s important to pick someone whom you trust to have access to your financial documents, bank accounts, insurance policies and will. This designated person is your backup to help sort things out in case disaster strikes. They will make financial decisions for you if you are unable to do so. They can be the executor of your will, a financial or health care agent, a family member or a trusted friend.
The following are five tips from an article in Kiplinger, offering steps you should take to help your backup sort out your finances:
Make a list of your assets, debts and instructions.
List all your assets, including bank accounts, 401(k) and IRA plans, and write down the address, name of the financial institution and employer for each. Also list contact information so your backup person can talk to your accountants, financial planners, mortgage brokers, insurance agents, attorneys and other professional guides.
Give instructions on how to locate your valuables.
Your backup will need the location and access to your residence and any safe, safe-deposit box and storage unit. They will also need your IDs, such as passports, birth certificates and Social Security cards.
Organize your insurance records.
Your backup needs to know about your life insurance policy and any long-term care and disability insurance benefits. They will also need your home, auto and any other insurance information. This includes the policy numbers and names of the companies administering those policies. Keep these documents in a secure location, and let your backup know how to access them.
Keep your will and healthcare power of attorney documents handy.
Have hard copies printed of these documents and keep them together in a folder so that, in case of an emergency, your backup can grab the documents and easily show them to any doctors, judges, police or other emergency personnel that they need to.
Keep track of your passwords.
Give your backup any necessary login information, including usernames and passwords, so they can access your banks, credit cards, airline miles and similar programs. Also, provide the info for your email and social media accounts.
While incapacitation or an untimely death may feel unthinkable to you now, it can happen to anybody. Having your important documents in order and a trusted person in the loop will make administering your estate so much easier and will relieve some stress on your grieving loved ones.
There’s a lot to navigate when it comes to estate planning, and legal guidance can be a huge help for you through the entire process.