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  • Why You Need a Will (and Life Insurance)

    Why you need a will - chieffamilyofficer.com

    One of the most unexpected and devastating deaths on TV came earlier this season when Lance Sweets was killed in the line of duty on Bones. He left behind his pregnant girlfriend Daisy, who gave birth a few episodes later. {With all the spoilers I come across, I’m amazed at how they kept this one under wraps until it aired!}

    Because of what I do for a living, I couldn’t help wondering what kind of financial mess he left behind. I think Sweets was the kind of guy who’d think things through – he worked for the FBI, and was out in the field all the time. So while he certainly didn’t expect to be killed when he was, I’d like to think he had made out a will naming Daisy as his primary beneficiary and/or set up a trust for the baby’s benefit.

    Part of the story line in Bones was that Sweets’s adoptive parents had died and he was an only child, so theoretically, there shouldn’t be anyone contesting the will. But unless he’d put all of his property into a living trust that made Daisy the trustee upon his death, his estate would have to go through probate. If he had a will, the process might take a while but at least it would be straightforward.

    But if he didn’t have a will, two painful scenarios immediately popped into my head: First, the probate judge might require proof that Sweets truly was the father of Daisy’s baby; and second, someone might come out of the woodwork, claiming to be a relative of Sweets and therefore entitled to all or part of his estate. At least once the judge accepted that the baby was Sweets’s child, state law should mandate that his entire estate pass to his child.

    I’ve also been hoping that Sweets would have thought to name Daisy the beneficiary of any life insurance policy he might have had. Then the proceeds from the policy shouldn’t have to go through probate. I can’t think of anyone else he would have named as a beneficiary, but supposing he did have a policy that didn’t benefit Daisy or their child, there could be another mess – state law might supersede the named beneficiary once the baby was born, and appoint the baby as the default beneficiary. Then there might be a legal battle as to who is entitled to the life insurance proceeds.

    The bottom line I take from all of this thinking: Take care of your estate planning while you can. Have an up-to-date will. Make sure the beneficiaries listed on any policies and accounts are current. Don’t leave a financial mess for your family to deal with when you’re gone.

    Image via FreeDigitalPhotos.net by Mister GC.

    Monitoring Your Credit Report

    A few years ago, it became possible for consumers to get a free credit report from each of the three major credit bureaus at AnnualCreditReport.com. You can get one free report each year from Equifax, Experian, and Transunion.

    One way to maximize your access to your credit reports is to obtain one credit report from one of the credit bureaus every four months. That works out to three reports per year, so one report per credit bureau. But spreading out your requests throughout the year makes it easier to catch something hinky sooner rather than later.

    I failed to take my own advice and it had been a couple of years since my husband and I had checked our credit reports. I’d forgotten how easy it is to do, and they’ve made it easier to understand each section. I was also able to print the report as well as download a digital copy.

    Now I’m setting up email reminders in my Google Calendar to remember to request a copy of our credit reports every four months. The credit bureaus vary slightly in their reporting. And since we have combined finances, I’ve decided to request reports from different bureaus for myself and my husband each time, which should further maximize our chances of catching anything untoward.

    One good thing we did a couple of years ago was add an inexpensive rider to our homeowner’s insurance policy – for $25 per year, we get Identity Restoration services. So when we had a question about something on one of our credit reports, we just called our insurance company and they’re investigating it for us. Hopefully it’ll turn out to be nothing, but I’m feeling the $25 per year is money well spent.

    There are, of course, companies that will monitor credit activity for you. But it’s easy to do yourself – just don’t forget to set those reminders!


    Banner ad via Logical Media.

    Long-Distance Long-Term Care

    This post is sponsored by Genworth Financial. All opinions are my own. Read the full CFO disclosure policy here.

    As I’ve mentioned before, long-term care is something I think about because I see my parents and my in-laws dealing with issues related to long-term care with their parents. We’ve previously discussed what long-term care insurance is, whether and when to buy long-term care insurance, the cost of long-term care, and finding help for caregivers.

    But what if you don’t live near your loved one who needs care? This is a very real and personal concern of mine, because my mother doesn’t live near her mother, and I don’t live particularly close to my parents. My mother is lucky enough to have a sister who lives with their mom, so my grandmother is really well taken care of – but even then, it’s difficult. My aunt has to see when my mom is available to visit in order to plan her overnight trips for work, and it’s difficult for my mom to step in for my aunt since she’s not there all the time and disrupts their routine.

    I’m an only child, so I won’t have a sibling or two (or more) to share the caregiving with. And being many miles apart makes me wonder if I’ll be able to adequately care for my parents when they need me. I always have the option of moving them closer to me, of course, but I wouldn’t want to do that if it went against their wishes.

    Fortunately, there are some resources to help plan – and that seems to be the real key: planning. The AARP has a great recommendation for creating a “Care Notebook” with all of the important information – doctors’ contact info, medical history, community resources, and so on. There’s a more detailed list of tips for long-distance caregiving, and a searchable list of caregivers by region so you can find someone in the area of your loved one. And has emphasized the importance of preparing for a future that includes aging parents.

    I’m lucky enough that my parents are in good health, and I should have years in which to get ready for my role as a possible long-distance, long-term caregiver. But the time to start preparing is now.

    Help for Caregivers

    This post is sponsored by Genworth Financial. All opinions are my own. Read the full CFO disclosure policy here.

    As I see my own and my husband’s grandparents needing more care as they age, long-term care has really become a relevant topic for me. We’ve previously discussed what long-term care insurance is, whether and when to buy long-term care insurance, and the cost of long-term care.

    Long-term caregiving isn’t easy, whether you have to be a hands-on caregiver, or you’re more of a coordinator who ensures that your loved one is getting the care they need. That’s why I like Genworth Financial’s Caregiver Q&A on Facebook. Some of the topics covered are how to choose a professional caregiver, how to select a nursing home, protecting aged loved ones over long distances, and more.

    There are also ways to prepare long-term caregiving, as this USA Today article mentions.

    Even for those of us who are hopefully too young for this to be a pressing issue, it’s good to have a few things in place for the unthinkable: A power of attorney (which gives a specified person legal authority to make financial decisions on your behalf if you’re unable to do so yourself); a health care proxy (which gives a specified person the authority to make decisions regarding your medical treatment); and a living will (which should include instructions for end-of-life care).

    It’s important to have these documents yourself, to make things easier for your loved ones in case something happens to you. And that also gives you a nice opening for a discussion with those loved ones: I just had a durable power of attorney and living will made up, in case something happens to me. Do you have them too? Or something like that.

    Think of it the way you do life insurance: hopefully you won’t need it, but you’ll be kicking yourself (or worse) for doing nothing if you do end up needing it.

    The Cost of Long-Term Care

    This post is sponsored by Genworth Financial. All opinions are my own. Read the full CFO disclosure policy here.

    Last fall, we talked about what long-term care insurance is, and whether and when to buy long-term care insurance.

    Now, Genworth Financial has a handy Cost of Care Map, which you can access by clicking on the image below:

    The map allows you to view compare costs across locations, and calculate projected long-term care costs.

    For example, in California, the median cost for a private one-bedroom apartment in an assisted living facility is $42,000 per year. In 30 years, when I may need such care, the cost is projected to be an astonishing $181,522! Yikes! If you’re in a high cost-of-living area, you may want to check out this list of the 10 most affordable cities for long-term care.

    The cost of health care is only going to go up. So it’s definitely worth investigating whether long-term care insurance is right for you. Start here to learn more about long-term care insurance.

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