Yearly Checkup and Resolution


Please do something about these if you have not already.

And NONE of them have to do with accounting or taxes, so I am not selling anything...except peace of mind!

Furthermore, each is one paragraph long, so it will take you less than five minutes to read.

If you already have these, please update or verify immediately!

Guess what? Everyone dies and you never know when that may be. (Sorry to be so blunt, but I needed to get your attention). We may not like to think about it, but IF, no, WHEN, it happens, do you have your spouse and family covered? Do you want them to have a court tell them what to do with your money, possessions, or children? A Will can alleviate that stress. Remember, you are departed so they are on their own! Make sure they know what you want IN WRITING. Also, a Will often resolves disagreements, is not that expensive, and is most of the time much cheaper (and less stressful) than going to court so a judge who has no idea who you are will decide who gets what!

If you are gone, how will your spouse, and children, survive? Either you were the sole "bread winner", or your family lived a husband and wife two-income life style. Therefore the money coming in is cut in half...or totally gone. All the expenses are basically the same. You still have a mortgage, electric, gas, etc. The kids are still going to cost money, and we all know kids get MORE expensive as they get older. You need a life insurance policy to help 1) get your spouse "over the hump" from living on half an income amount (or no income possibly); and 2) at least paying a substantial part of the children’s expenses until they are 18, 21, or maybe 26 years old.

If you fell off the face of the earth right now, would your spouse know where all your non-household assets are? I mean those cash type items that are not physically in your house. For example, the savings account you have for a rainy day that only you know about. Or maybe the 401K/IRA from work, or the safety deposit box that has the car title in it (or your Will), or those stocks you bought 10 years ago, or what company has your life insurance policy so s/he can begin the process of getting the money, or even your Bitcoin wallet site. Sit down, make a list, and be sure your spouse knows where it is and what it means. If you put it in the safety deposit box, make sure s/he knows it is there and has access to it.

Social Security typically pays $1200-$2000 a month. That is $14,400 to $24,000 per year. Could you live on that? What percentage of your current income is that? Do you really believe that you can live nicely on that amount of money, or that percentage of what you earn now? You will still have most of your expenses: electric, gas, insurance, etc. (Hopefully the mortgage is paid off or that will really throw a monkey-wrench into things). We all know as we get older there will be more health problems...and what is one of the fastest growing expenses in the US? Health care (actually, college is just as bad too!). Bottom line: you need to put aside money for retirement. You need to sign up for your company 401K or put into an IRA/Roth IRA-or just put it into a vehicle that will earn you a reasonable return. If you are an owner in a one or two person company, consider a SEP or Simple Plan which will allow for a larger dollar amount of savings per year. A larger, healthy company should consider starting a 401K or some pension savings plan. But no matter some money for the future.

Update Beneficiaries:
For those of you who already have life insurance policies, retirement plans, and wills, have you verified beneficiaries? Is it your Ex-husband/wife or a deceased relative? Is the Will still as you wish as far as who receive what, or the executor, or who raises your children? Maybe the life insurance policy goes to "Child #1", but now you have 3 children. Did you mean it for only the oldest child to receive it? If the other children’s names are not on it, they will not receive it. If you put it into your family trust, does that make it taxable? If it is in your spouse’s name and you both died simultaneously, who is the secondary beneficiary? Tertiary beneficiary?

Power of attorney:
Oversimplified, this allows the spouse or adult children legally to sign for you. It will allow your family to function somewhat normally if you are incapacitated or have passed away. Power of Attorney can be tailored to areas you wish, possibly financial transactions or medical treatment. They can even be assigned to two people that must agree on any transaction if you want safeguards. It can even be for a specific amount of time or a specific transaction (allow you to sell someone’s car only). The point is that if you are in a coma, seriously injured, or dead, your family needs to continue to survive. That personal checking account in the spouse’s name can only be accessed by that spouse. The bank cannot help you, even if they know you are the husband/wife, unless you have the power of attorney. And do not forget the 18-21+ year old who is considered a "legal adult". What happens when s/he is in an accident or dies? Who can talk to the doctors or get in his/her bank account? Without a Power of Attorney, life can get very stressful.

Advanced Directive:
If you are in an accident and in a vegetative state or so sick that you cannot respond to a doctor and there is a small chance of recovery, does your family and spouse know what you want them to do? Do they know if you want every avenue tried to save you even if there is a small chance of recovery…or do you want them not to prolong your life? You need to decide because a family is going to be emotionally torn apart by a decision they do not want to make. Deciding on a plan of action that is based upon your wishes will make whatever decision you want easier for them, whatever it may be.

I do not perform or sell any of the above, and I am not a lawyer, YYbut it is part of an overall financial consultation to make you think and prepare. If you have no one to talk to about these issues, feel free to contact me and I will get you in contact with someone who specializes in each area. I know we all believe that we will live until 100, but unfortunately every year, fate throws a twist into our plans.

All Business. planning/2475-1.html#axzz1wCZLaDio. December 4, 2014.

Kate Ashford. September 9, 2009.