Starting Your Estate Plan

In 2011, my wife got the call that her father had died unexpectedly. Within 24 hours, she arrived in Spain for the cremation. After arranging for someone to watch the kids and take care of some other things, I caught the next flight to Spain as well. One thing is sure with estate planning: we MUST talk about it.

Talk About It

I was fortunate enough to enjoy this Roman aqueduct (pictured left) in Segovia, Spain, over a pleasant conversation with family at lunch. Like this monument that bridges the past and present, a good conversation about your estate wishes could help bridge the present and future.

On my flight over, I serendipitously came across an article in the Journal for Financial Planning that could help you start the estate planning process. The article was about a financial advisor asking: If I die, what happens to the business? This question spawned several scenarios which exposed flaws in their business transition plan. The same idea can be applied to your personal estate plan.

Ask Questions

Ask the question, if I die, what will happen? If your spouse is anything like mine, you’ll have difficulty with this question because it forces you to think about the inevitable. Nobody wants to contemplate their mortality. But it is crucial because it can expose problems with your estate plan.

Sit down with your spouse and walk through what will happen if one or both of you dies. Ask questions like:

• Do you each know where all your accounts are located?
• Are they titled so that either of you could go to the bank and get information while you are waiting for death certificates to be issued?
• What are your advisors’ phone numbers?
• Do you have enough liquid savings to pay the bills for a few months?

These are especially good questions to ask if you have one spouse that handles all the money. If this is the case, you might even ask the non-financial spouse questions like- how many bank accounts do we have? Where are they? Who owns them? How would you contact them?

These questions tell you how knowledgeable you each are about your finances. More importantly, they may prevent some financial surprises. By the way, one of the best places to gather this information is your tax return. A tax return will show you where you receive interest and dividends, which tells you where you are banking and investing.

Takeaway

Talking about death is hard enough. Dealing with death and not being prepared for it is an entirely different thing. I’ve sat across the table from clients who said that their parent’s estate plan went smoothly, and I’ve also sat with clients who hadn’t had such a good experience. By asking the tough questions, you give your spouse something invaluable after you’ve passed: time to mourn.

Originally posted April 5th, 2011. Edited September 22nd, 2023.