Once you’ve transitioned into retirement, it’s important to complete your estate planning, living will, and end-of-life preparations. It’s equally important to discuss these preparations with your adult children. Doing so before any physical or cognitive needs arise can help ensure your wishes are carried out effectively and with minimal confusion, while helping your heirs avoid the time-consuming and costly legal probate process.
In my experience as a wealth advisor working with clients for almost four decades, there is no uniform or boilerplate way to make end-of-life preparations. There are often no clear answers, and solutions may be different for each family and situation. Many clients struggle with whether to grant their adult children access to end-of-life plans, which information should be shared, and how to best disseminate this information. But preparing for the end-of-life process doesn’t need to be challenging. Taking the proper steps now can help avoid emotional turmoil later.
Discussing finances and end-of-life preparations can be an emotionally charged topic. While often difficult, it is necessary. Thought and care should be given to the unique dynamics of each family situation. However, the more you are willing to share, the more likely you are enabling family members to be on the same page and prepare accordingly. For example, if you are splitting your estate unevenly, explaining your rationale can help stave off any sibling rivalry, jealousy, or hurt feelings. And having the discussion now can help your loved ones avoid unnecessary expense, feelings of confusion, resentment, and stress.
While solutions for your particular scenario will be unique, the checklist below can help facilitate the discussion:
- Documents and records: Where are your important documents and records (including will(s), living will(s), trusts, powers of attorney, health care directives, birth and marriage certificates, Social Security cards, passports, drivers’ licenses, proof of ownership for real estate or vehicles, auto/home/medical/long-term care insurance policies, etc.) located?
- Estate plan, will, and trusts: Is your estate plan and will up to date? Do you have an executor and alternate executor? Have you reviewed the documents recently to account for changes in your family situation or wishes? Do your trusts still meet your needs?
- Key contacts: Make a list of all the people who may need to be contacted, including your wealth advisor, lawyer, financial providers, accountants, doctors, friends and family, etc.
- Financial information: Compile a list of the account numbers and balances for all your financial accounts including savings, checking, investment, and annuity accounts. Is there an opportunity to consolidate duplicate checking or brokerage accounts or add an adult child to your account(s)?
- Debts and liabilities: Do you have any outstanding debts or liabilities?
- Online accounts and passwords: Create a list of all your passwords to access your devices and any online accounts. If you utilize Meta, consider using the feature to appoint an account administrator in case of death.
- Property: Do you own any property besides your primary residence? This may include storage units, investment properties, RVs, boats, and timeshares.
- Medications: If you take medications, where are they stored? Make a list of all medications including dosage, prescribing physicians, and pharmacies.
- Valuables and keepsakes: Where are your valuables and keepsakes located? Are these covered by insurance riders and have the items been recently valued?
- Living arrangements: How long do you hope to live in your current home?
- Long–term care arrangements: If you are unable to live on your own, have you considered a Continuing Care Retirement Community (CCRC) or retirement facility that may provide assisted living? Your children should know your preferences and how you plan to pay for care if necessary.
- Memorial/funeral: Do you have a particular vision for your funeral or memorial service? Share any details including contact information, location of plots or columbarium, and funeral insurance.
Download our Family Records Workbook. Consider filling it in and providing a copy to each of your adult children.
When it comes to the end-of-life preparation process, even the best-laid plans may not help unless you relay them to your heirs. And whether you keep track of your documents in a binder, spreadsheet, or other means, I’ve identified four additional steps that can help make discussions more effective and successful:
- Review the checklist above: Create both digital and physical versions of this information. For the digital version, make sure everything is password-protected and safeguarded. For the physical version, make sure all interested parties have physical (hard) copies of account information, birth certificates, and other relevant documents, and that all information is protected in locked, fireproof safes or locked fireproof boxes.
- Put details in writing: Be as thorough as possible.
- Update the information periodically: Review it once a year to help ensure all information is still relevant.
- Discuss details: Make sure you share with others when you are in a position of strength, both cognitively and physically.
It’s important to note that taking the time to have this conversation can help provide greater reassurance for everyone. If you need additional information about navigating your path or guidance in making your plans a reality, contact your wealth advisor. And if you’re not a client, let’s talk.
