Recently someone was complementing these articles and said how valuable the information in them was to them. One of her family members died recently and she wanted to make sure that her own affairs were in order.
Unfortunately, we see unexpected, untimely deaths at surprisingly young ages more than we would like. And with the devastating massacre in Las Vegas, these planning tips are for all of us, no matter your age. So, here is a brief outline as a reminder.
First, understand what legal document controls the asset’s disposition at your death.
Your retirement plan, insurance policies and IRA accounts are controlled by beneficiary designation forms, not your will. This means the beneficiary designation form you completed when you first went to work 20 years ago still controls your retirement plan even if you have had significant changes in your life. We recommend that you check your beneficiary designation forms at least once a year.
Jointly-owned assets are also not controlled by your will, but upon your death will pass immediately to your survivor. The most common jointlyowned assets are bank accounts and real estate. A common mistake is, instead of adding an additional signer or power of attorney to your bank account for signing convenience, you or the new accounts clerk at the bank check the box for joint tenants with right of survivorship. Unfortunately, this title will cause the account to pass at death solely to the joint owner. Always make sure you make an intentional decision on the ownership of an account or real estate.
What does the will control? Everything that’s just in an individual name and stuff that doesn’t have a title or registration are controlled by your will. There are very specific rules about what makes a will legal. In Tennessee, your will must be either entirely handwritten (holographic) and signed; or if it is a typed will, it must have the proper witnesses (and an affidavit of the witnesses is good, too). Proper execution is crucial for a will to be valid, and you must probate the original document. A copy will not suffice.
Second, let’s not forget disability.
The disposition of your property is very important, but what is more important is making sure your loved ones have the tools to be able to care for you if you cannot care for yourself. Everyone should consider having a financial power of attorney. This allows someone you trust to make financial decisions if you are unable to do so. If you are incompetent and there is not a power of attorney in place, court action may be necessary to manage assets in your name alone. Naming someone to make your health care decisions is also key.
Third, go ahead and consider making your own funeral arrangements if you are so inclined. It will help your grieving family to know that they are carrying out your wishes versus worrying about what you would prefer.
And the best time to address things like this is now, while you are in good health and in a good state of mind. We know the old Ben Franklin saying, “In this world nothing can be said to be certain, except death and taxes.” You can take control of some of the aspects of what happens after death. Now if only those folks in Washington would work on the tax side.
Sharon Pryse, chairman and founder of The Trust Company, may be reached at email@example.com.