Handing Down Your Legacy - A Special Gift For Readers

FORECASTS & TRENDS E-LETTER
by Gary D. Halbert
December 30, 2014

IN THIS ISSUE:

1. Death – An Unpopular Subject

2. Most Survivors Are Unprepared

3. Getting Your Affairs In Order

4. Write it All Down - Electronically

5. Free Gift For My Readers

6. Other Things to Think About

Overview: Death - An Unpopular Subject

As we prepare to celebrate the New Year, now is a good time to make sure that your affairs are in order and all of your financial information is recorded in one convenient electronic file that can be updated or changed at any time. And we believe we have developed the best program on the market today to do so.

Today I am going to address several important financial planning issues everyone should consider, whether you’re young, old or somewhere in between. I will also tell you how you can receive our free E-booklet entitled, “Handing Down Your Legacy” that will help your loved ones manage your finances after your death. Sadly, this is often much more of a difficult burden than most people realize, but it doesn’t have to be that way.

No one likes to talk about death. Many people put off planning for this certainty because it’s just not pleasant to think about. Additionally, most young people think that death is a long way off, so they have plenty of time to plan for it. But as we all know, accidents happen and no one knows exactly when their time will come.

Upon your death, loved ones are usually the hardest hit, not only by the grief of the loss, but also by having to deal with the burden of getting your finances in order. Whether the loss is expected (in the case of an older or terminal person) or it comes as a complete surprise, there are many issues that have to be dealt with when handling an estate.

That’s why it’s very important to have a plan that includes all the details your loved ones will need in order to make dealing with your loss a little easier. Our Handing Down Your Legacy is a convenient electronic document that makes it easy to put all of your important information in one place and makes it easy to update.

There are several products on the market that allow you to consolidate all of your financial information in one place, but we developed Handing Down Your Legacy to allow you to include not only your investment records but also your final wishes. We believe our product is simply the most comprehensive and easy to use program available today.

And best of all, it is absolutely free and there is no obligation on your part. So do yourself a favor and download Handing Down Your Legacy today. And make it your New Year’s resolution to complete it as soon as possible. Also, feel free to forward this E-Letter to your family and friends who may also benefit from this useful resource.

Most Survivors Are Unprepared

Obviously, there’s the grief that comes with the loss of a loved one. If that weren’t enough, I once read that over 90% of survivors are not fully prepared to deal with the financial and other issues that come up after the death of a loved one. I certainly believe it based on my own experience in the financial services business. It’s not uncommon for loved ones to contact us without a clue about where to even get started handling the issues related to the remaining estate.

Think about all the assets, investments, insurance policies, liabilities, etc. that you have and all the details related to them. Sometimes it’s challenging for us to keep up with just our own finances. Now imagine someone else, who is already dealing with your loss, trying to come in and figure it out without the benefit of your assistance. Think of the time and research that would take, and of the things that might slip through the cracks.

In many cases, one spouse is the financial partner, in charge of the checkbook, investments and most importantly, filing of important papers. The other spouse may only be minimally involved, signing on the dotted line when necessary and generally knowing where important records are, but not familiar with the details. It can be overwhelming and important things can get missed.

According to CNN Money, there is almost $60 billion in unclaimed assets in the US. Some of it is property that went unclaimed after the owner’s death simply because the heirs were unaware that the assets even existed. After a period of time, unclaimed assets are simply turned over to your state. We have actually seen this happen.

There's no wonder why many survivors struggle to figure out what their loved one’s financial situation is, because they are having a hard time finding all of the paperwork, much less sorting it out. An article I read last year estimated that as much as 25% of life insurance benefits are not paid to beneficiaries because they didn’t know a policy existed. How sad!

Important Note: If you are a client of Halbert Wealth or ProFutures, please make sure that your spouse knows to CALL US before making any decisions on the investments you hold with us. We often see surviving spouses decide to liquidate all of the investments simply because they do not understand them, even if doing so may be harmful.

Yet if they call us at their convenience, we will not only educate them about the reasons you have investments with us and determine if they are still suitable, but we will also offer an objective look at any other investments you may have elsewhere. We want to help however we can.

Getting Your Affairs in Order

Taking the time to document the financial details that pertain to you will save your family hours of searching, on top of the emotional strains they will be dealing with. We all know that when we’re under emotional stress, we don’t always make the best decisions.

The first step may sound too simplistic, but it is to gather your financial information into one safe place. It is amazing to me how many different places financial information is kept in many families. Some have part of their information at their office, other parts at home, some in a file cabinet, some in a dresser drawer, some in all of the above, or other places that might be easily overlooked.

There are times when survivors find important documents only by accident, and sometimes long after the death. It’s also important to separate information on accounts, assets, insurance policies, etc. that are no longer owned. This can save your loved ones from going on a wild goose chase searching for an asset that no longer exists.

We can help! Read on to see how you can obtain a free resource to help facilitate the handling of your financial information upon death.

Store important information Write It All Down - Electronically

Once you have all of your information in order and organized where they can find it, you should document all of this in a concise manner. This documentation will serve as a guidepost for your survivors to let them know what assets you have, where they are located and how they should be treated. It is not enough to just tell them and hope they remember. Keep in mind they’ll also be dealing with the grief of your loss.

There are various methods of documenting everything your survivors will need to know. Some write a letter to the surviving partner detailing where all of the important papers are and how they should be handled. However, it is sometimes hard to think of everything to put into the letter, and a letter that covers everything may be so long that it’s overwhelming. Plus, it needs to be updated regularly.

Others keep a summary file folder with their important papers that contains copies of statements for assets, special instructions, important contacts, etc. The summary file approach is usually easier to update than rewriting an entire letter to address changes.

I don’t recommend either of these approaches. I have always favored a more detailed approach for keeping track of your assets and leaving instructions for your loved ones when you are gone. Fortunately, you can now document all of this information electronically, in a single easy-to-update place. Think how much easier this will make it for your loved ones.

There are various products on the market you can buy for doing this. However . . .

A Free Gift for My Readers

My firm recently developed a useful and thoughtful financial tool to help organize all of the important items necessary to pass on to loved ones in case of your death. It’s an electronic booklet entitled Handing Down Your Legacy, and I’m going to make it available to my readers and their family and friends free of charge.

Handing Down Your Legacy allows you to store all your important financial information in one place. We tried to think of everything that would be important for your loved ones to know. You simply enter the information, and make sure to update it as things change or if it becomes outdated. The electronic format is superior to a paper booklet or letter, in that it allows you to simply enter information into a template and change it as often as needed.

We are making this available in both a writeable PDF file and a Microsoft Word file, so you can select the best format to fit your needs. Both are easy to complete, but the Word file gives you the flexibility to add more details or include other information that may not be listed in the PDF format. You can customize it as you see fit.

To obtain your FREE copy of Handing Down Your Legacy, give us a call at 800-348-3601 or complete our online request form. There is absolutely no charge or obligation involved. Making this e-booklet available to you is a way for me to show my appreciation to all of those who regularly read this E-Letter. You can also forward this E-Letter to family and friends that you think might benefit from it.

Once you successfully download the E-booklet, I encourage you to complete it soon, and then let your spouse or other loved ones know where it will be saved on your computer. It’s also important to make a backup copy in case of a computer malfunction, and you may even want to print out a copy and keep it in a file for easy reference. Just remember that this document will contain some of your most sensitive information, so use secure passwords and if you print a copy, keep it in a safe place.

It is also important that you review the information in your Handing Down Your Legacy booklet at least annually to make sure all information is current. Outdated records can be just as confusing as no records at all. The Microsoft Word and PDF formats make changing the information quick and easy, so keeping records updated isn’t a chore.

Other Things to Think About

While you are working on this, there are some other things you should think about:

1. Update your will. If you don’t have a will, get one ASAP. It is also very important to update your will periodically, as well as any trusts you may have established. I recommend that you consult a competent attorney who specializes in estate planning for this.

2. Make sure all of your assets are titled correctly. The way assets are titled has an effect on how they transfer upon your death. For example, a bank account held by two people as “joint tenants” transfers differently than if it were jointly owned with “right of survivorship.” Again, you may want to consult with an attorney on this.

3. Make sure contractual beneficiary designations are current. Life insurance, annuities, retirement plans and IRAs can all be transferred contractually by naming a beneficiary. This means that the proceeds are transferred outside of the will and need not go through probate in most cases, which makes it even more important to keep these beneficiary designations updated. It is also important to name contingent beneficiaries should the primary beneficiaries predecease you.

4. Make sure you have a “financial power of attorney.” A financial power of attorney simply empowers a trusted individual to manage your finances should you become incapacitated. It takes effect at such time that you can no longer handle your own financial affairs, and ceases upon your recovery or death.

5. Make your wishes known. This piece of advice is obviously not limited to financial issues, but it is vitally important to make your specific wishes known when transferring financial holdings or any other asset with significant value upon death.

To do so, it is imperative that you state your wishes clearly in either a will or living trust. Another very important item to consider in this process is the disposition of financial assets. Whether those financial assets are stocks, bonds, investment or security accounts, or real estate, it is important leave specific instructions as to how they should be handled upon death.

We occasionally get calls from widows who are trying to sort through the family investments and determine what they should do with them. Sometimes these callers are in a near-panic trying to make decisions about assets they know little or nothing about. It is unfortunate that even some people who list out their financial assets in great detail fail to communicate the plan behind those holdings.

Again, if you are one of our clients, please make sure that your spouse knows to CALL US before making any decisions on the investments you hold with us. We often see surviving spouses decide to liquidate all of the investments simply because they do not understand them, even if doing so may be harmful.

Yet if they call us at their convenience, we will not only educate them about the reasons you have investments with us, but we will also offer an objective look at any other investments you may have elsewhere. We want to help however we can.

Investments do not occur in a vacuum, and are usually based on a plan to meet financial goals. If communicated, the plan you set in motion during your lifetime could serve your loved ones going forward. However, if only the holdings are listed, and no details about the plan, there’s a greater likelihood that assets will simply be cashed out.

Conclusions

As I stated at the beginning of this article, it is very important to have a way for survivors to obtain financial information upon the death of a loved one. I kept my comments very general and focused mostly on basic financial matters, since that’s what we typically encounter upon the death of one of our clients.

Suffice it to say that there are many financial, legal and family issues to be considered upon a person’s death. These issues can either be dealt with prior to death through careful planning with qualified professionals, or left to bereaved survivors who will have to face these issues during a period of great stress and turmoil.

I suggest you carefully consider the suggestions I have given and take steps to inform and protect your loved ones prior to your passing. I highly encourage you to download our free Handing Down Your Legacy E-booklet and complete it as soon as possible. If you have a spouse who is usually not involved with financial matters, you may want to have them help you complete it. This will help communicate the importance of becoming involved in the family finances.

While the subject matter of this week’s E-Letter may be less than cheerful, it is nonetheless important, especially in terms of long-term financial and estate planning. We all know that none of us is guaranteed to see tomorrow, so pre-death planning is an important consideration for anyone who wants to make it easier for their surviving loved ones. Remember that the time you take to compile this information today will help ease the burden on your loved ones when dealing with the financial matters related to your estate.

Also, since almost anyone could benefit from this information, I encourage you to forward this E-Letter to your family and friends. Then they too can benefit from this useful tool.

So, download the E-booklet today, get your information and wishes loaded as soon as possible, and when you do, you will feel a sense of great accomplishment – I promise!

Best New Year’s wishes,

Gary D. Halbert