“You never know when a Mack Truck is going to run you over.” That blunt fact was delivered by William D. Kirchick, Esq., the past president of the National Association of Estate Planners & Councils, who has made a living out of reminding people of their own—possibly imminent—deaths. He doesn’t mince words, because, as an estate lawyer who helps clients safeguard their assets for heirs or charity, he has seen what happens when people don’t think about—and plan for—their earthly end of the road.
For example, when you die without a legal will, called “dying intestate,” you hand over to the government the fate of your estate (basically everything you own) and the humans and/or animals who depend on you. And the government doesn’t know that your dog can’t stand your sister or that you wanted your money to go to your life partner instead of your parents (if you’re not legally married, your partner will likely have no claim on your estate).
Since we’re all going to die (yes, even those of us who are still in our 20s!), we might as well make things easier for the loved ones who, along with grieving our loss, will have to deal with the financial and logistical pieces of our lives. So don’t think of planning for death as a morbid chore, but rather as a final gift you can carefully craft, wrap and deliver to your family and friends. Here’s how to get started.
1. Write down your passwords. Compile a list of all the passwords you use for, well, everything: bank accounts, health insurance, utility providers, streaming services, gym memberships, wireless providers, your Gap.com account and even your social media accounts. People will need to access your information, learn about your benefits, and cancel subscriptions and memberships, says Kirchick. “This is the number one thing people forget to do and it makes things infuriating for the people left behind.” You can use a password manager such as Bitwarden, Keeper or LastPass—just be sure to write down the passwords for those, too.
2. Create an estate-planning form. Make a record of all your assets and keep it with your list of passwords. What counts as an asset? Retirement saving accounts, college saving accounts, life insurance, investments, trusts, real estate, businesses and valuable possessions (think heirloom jewelry, blue-chip art and cars). Include details about safe deposit boxes, insurance agents and financial advisors.
3. Catalog your debt, too. Since outstanding debts (from student loan payments to mortgages) will be collected directly from the value of your assets after death, it’s important for your heirs to have a realistic sense of what they’ll be inheriting.
4. Complete your advanced directives. These crucial documents typically include a living will (which specifies the medical treatments you do and—more importantly—do not want if you become terminally ill or injured) and a power of attorney, which names the person you want to make decisions on your behalf.
5. Draft a will. Dying without a will is like driving without a license, experts say. And despite the fact that everyone over the age of 18 should have one, less than half of all American adults (and just 20% of Americans under age 30) do, according to a 2021 Gallup poll. A will is where you lay out instructions for the distribution of your estate and name guardians for minor children. You can create a will on your own using online services like Nolo’s Quicken WillMaker, but if you have kids, a large estate or just got divorced, it’s best to hire a lawyer to make sure all your i’s are dotted and t’s are crossed, says Kirchick. You should also talk to a financial advisor about the possibility of creating trusts for your kids—trusts allow you to specify when and for what purposes heirs can access inheritances.
6. Update your beneficiaries. Certain assets, including life insurance plans and retirement saving plans, are not included in your will because they have individually appointed beneficiaries (the people who receive the funds after your death). If you joined your company’s 401(k) plan when you were 23 and single, for example, you may want to update the beneficiary now that you’re 35 and married.
7. Write a letter of intent. A letter of intent, also called a letter of instruction, includes personal details, and wishes that may not be included in a will. Do you want your green-thumb neighbor to adopt your potted plants and succulents? Should your niece get first dibs on your costume jewelry collection? This would be the place to document those types of desires, along with any instructions for the disposition of your body like burial or cremation, charity preference, and the locations of important documents (like those listed above). If you have young children, you can also use this letter to inform any future trustees, guardians and/or caregivers, of your child’s abilities, medical history, likes and dislikes, and more—anything from the name of their loveys to their favorite ice cream flavors.
8. Review your plan often. “I recommend to my clients that they reassess their will and estate plan every three to five years,” says Lauren Wybar, a certified financial planner and a senior financial advisor at Vanguard Personal Advisor Service. And, she adds, absolutely update them any time a major life event occurs—for example, if you moved to a different state or country, get married or divorced, have children or acquire substantial new assets. “I find it helpful to be reminded in a very concrete way of my mortality every now and then,” says Kirchick. Maybe you will, too?
Patty Onderko is a writer and editor who has covered health, parenting, psychology, finance, travel and more for 20 years. She lives in Brooklyn with her wife and two sons.
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