As families gather together for summer vacations or events, there may be opportune times for parents to discuss some personal matters with their grown children. Communicating openly with your family members about financial, estate, and medical arrangements that could affect the entire family, helps everyone prepare and plan for the future. This need not include detailed facts and figures; however, you may want to consider sharing some of the below measures you have in place with your adult children or assignee.
Life Insurance. Life insurance is typically purchased to provide a death benefit to help cover final expenses, estate taxes, outstanding mortgages, other liabilities, and lost income. Knowledge of the existence and location of life insurance policies can be of the utmost importance to children when settling their parents’ finances in a timely manner.
Other Insurance. Be sure to provide other insurance policies that you may have, including health, disability income, and long-term care insurance. Older adults can greatly benefit when their children understand, and follow appropriate procedures, as well as submit any necessary forms on deadline.
Wills. Do they exist and are they up-to-date? Preparing a will helps ensure that your assets are distributed according to your wishes and avoids leaving the disposition of your estate up to your particular state and its probate laws. Although the exact contents can be kept private, it is important that the location of your will should be made known to family members or a trusted advisor.
Trusts. Trusts can help protect your estate from unnecessary taxation or mismanagement. Make sure to discuss pertinent terms with those who will be involved. As your children reach adult age, it may be time to select a responsible child or significant other to serve as a trustee in the event of your death.
Living Will and Health Care Proxy. A healthcare proxy and a living will both have the same purpose: to see that your medical wishes are expressed and honored, even when you can’t do so yourself. A medical proxy gives someone the authority to make those decisions for you, while a living will outlines those wishes in writing.
List of Assets and Debts. Once again, it’s important they know the existence of a list of assets and debts without seeing the actual details themselves, unless you so desire. An asset list should include information concerning all bank accounts, real estate holdings, pension holdings, annuities, business agreements, brokerage accounts, etc. A debt list should include information pertaining to current mortgages, consumer indebtedness, personal loans, and business obligations.
Initially, preparing these records may seem like an overwhelming task. At Biondo Investment Advisors, we can help coordinate with your legal and tax professionals or introduce you to ones we have established relationships with, to review any of the documents listed. Additionally, our WealthMap personal planning platform, provides a centralized, secure and organized location to store all of your important documents and financial files. You can utilize the Shared Documents folder that is accessible to your advisor in order to collaborate on financial plans, and also, the My Documents folder for files private and visible only to you. There is peace of mind knowing that you and your family will always know where important documents are in times of need.
We understand that these are all very personal subjects. Our Wealth Advisors have these conversations every day and are skilled at making clients and family members feel comfortable and informed. As your trusted partner, we are happy to help facilitate the conversation concerning your key financial and estate planning information with your adult children. Hopefully, once accomplished, you can feel good about the legacy you’re leaving.
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