Locally based CPA firm since 1956

Death – no one wants to think about it and certainly, no one wants to talk about it; yet, it’s the one inevitable experience all humans have in common, after birth.

With the recent passing of two very close clients and the unexpected passing of two family members, I have been thrust into the role of helping survivors make final arrangements. Perhaps the most difficult part has been winding down various business and personal affairs post-funeral.

I was first asked to assist family after an accident claimed my nephew. While dealing with terrible grief and all the emotions that come along with the sudden loss of a loved one, we were faced with an overwhelming number of tasks. While a person is alive they may have many relationships that they manage, most are not all that complicated, but to survivors the task of management and closeout becomes quite complicated, time consuming and confusing.

We probably have all read estate planning documents. These generally include lists that should be maintained such as: name, work phone numbers, doctor, accountant, lawyer, insurance agent, financial advisor and so on. These lists also generally include making someone aware of where to find important documents such as; a will, trust documents, insurance policies, power of attorney and advanced health care directives. By the way, if you do not have all this information written down, in safe keeping and with a separate copy given to at least one of your advisors such as your accountant, financial advisor, or lawyer, don’t feel alone. Over 70% of Americans do not have all this information organized and filed with a trusted advisor.

I strongly encourage you to create an inventory of financial accounts and insurance policies then schedule a visit with your accountant or financial advisor. There are multiple types of accounts that will need to be transitioned after death. Understanding the various accounts such as, Joint with Rights of Survivorship or Transfer on Death, will allow you and your advisor to set up the accounts in a manner that will ease the transition and maintain tax efficiency.

I also learned through the experience involving my nephew that maintaining a list of non-financial accounts is enormously helpful. In the months after his death, I found myself contacting folks such as Netflix, Amazon, Facebook, LinkedIn and Yahoo, along with folks like City Services and cell phone providers who had established auto draft for monthly payments, with intent to shut down the accounts. I now have a rule in my house, “If it requires a user ID and a password, maintain a list with updated information and keep it with other important documents.” The deceased won’t care, but the survivors will be spared hours and hours of tedious and frustrating documentation and conversations as they attempt to close out all the various accounts.

One last item of pre-death planning can and should be addressed: Final Arrangements.

There are many preparations that can be made ahead of time to plan for death, including pre-paid funerals. Here are some basics:

1) You can pre-pay an amount that will not count as part of your estate and that is sheltered from health care and nursing home claims.

2) Most funeral homes will give credit toward guaranteed costs that can be predetermined such as the casket, outer container and funeral service. If the prepayments exceed the actual cost, the remainder of any overpayment will be attributed toward the non-guaranteed items such as the cost to open/close the grave, escort service, minister and flowers. If there are any funds remaining, the funeral home will refund the survivors.

A few items that folks tend to not think about, but are important, can be handled very simply pre-death. As the survivors make final arrangements for their loved ones, they are faced with many decisions, some may seem trivial now, but all will be very important after death. After my family experience I have taken the time to document which suit I want to be buried in, what songs to play at my service, a list of pall bearers, a particular passage from scripture that gives me comfort and a few other items. The more decisions you document pre-death, the fewer burdens and less stress you place on your survivors.

Next Month: Post Death
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