Financially Planning for Sudden Debilitating Illness or Death

Being in the financial planning business for as long as we have, we often encounter unique situations that offer an opportune learning experience for ourselves and our clients. Not wanting to keep these valuable lessons to ourselves, we’ve decided to “share the wealth” with you going forward in hopes that you will also find this information useful.

It’s not easy or fun to plan for the possibility of debilitating illness or death. These can be hard conversations to have with your loved ones, yet crucial for any sound investment plan. It can be overwhelming for your family members to try and piece together your financial affairs and track down all of your assets on their own. We have seen it personally when our clients’ children reach out to us to let us know of the passing of their family member. It’s a mix of confusion and frustration.

An effective way to help avoid this would be to sit down with your beneficiaries and/or family members and list out all of your assets and important contacts like financial advisor, attorney, CPA. Make sure your family members know how to contact your professional advisors in the event of your incapacitation or death. It is also vital that you provide copies of important documents to them so they are better able to keep track of your accounts/assets. Doing this could also help in the event of a flood or fire. Important documents could include:

• Last Will and Testament
• Deeds to your home and any rental properties
• Titles to cars or other property
• Tax returns
• Birth certificates
• Marriage license
• Brokerage and bank account statements
• Retirement accounts like a 401k
• Insurance policies
• Trust paperwork

In the days and weeks following your death, your financial advisor can contact the executor (or legal representative) named in your Will, as well as your attorney and accountant. These professionals can work together to make the transition of ownership as smooth as possible. If you were still working, your beneficiaries should contact your employer to notify them and also to determine if there are any benefits available to them such as extended health care coverage through COBRA or retirement assets in a 401k or pension. Human resources can help them understand any time limitations in which actions or decisions need to be finalized, and your financial advisor can advise you on your choices.

If you would like to discuss this in further detail or develop an outline for your family, please reach out to us. We have a great tool to help you organize your affairs and it’s yours for the asking.

This case study is hypothetical and for discussion purposes only. It is not intended to represent any specific return, yield or investment. Individual experiences referenced above may not reflect the future experience of any one client. The planning process discussed may not be suitable for your personal situation, even if it is similar to the example presented. Past performance is no guarantee of future results. Investing involves risk including the possible loss of principal.