Making sure your financial and legal affairs are in order can be a lot easier with the right tools. A written inventory of all your assets is a good place to start. Your list should be comprehensive and include investments, bank accounts, real estate, insurance policies, retirement plans, and tangible property of value.
It is also helpful to indicate the location of the asset as well as the name or names on the title. For assets that pass by beneficiary designation, it’s good to list the primary and secondary beneficiaries.
If you haven’t done so already, let your executor or successor trustee know where to find important papers.
This includes financial statements, tax returns, originals of estate-planning documents, deeds, life insurance policies, along with the names and addresses of beneficiaries and family members. There are millions of dollars in unclaimed accounts as a result of poor recordkeeping. Don’t take the chance of letting this happen to your estate.
Here are 4 ways to ensure your financial affairs are in order:
- Make sure you understand how your estate plan works and that it is up to date. You may have the best attorney in the world, but you must understand how your estate plan works. As lives change and new laws come into being, it is important to understand the implications of your specific plan.
- Understand which assets are governed by estate-planning documents and which assets pass by beneficiary designation. There is much confusion on this topic. For example, life insurance, annuities, retirement accounts, and some types of bank and investment accounts may transfer by beneficiary designation outside of your will or living trust.
- If you have a living trust, make sure that you have re-titled assets in the name of the trust. If you haven’t taken steps to do this, your living trust is just an empty shell. Some attorneys assist with this process, some do not.
- Have other important documents like Durable Powers of Attorney and Advance Health Care Directives in order. Physical or mental incapacity may require that these documents take effect. Check to make sure that these documents are up to date and individuals named are capable and willing to act on your behalf.