- Doug Oosterhart, CFP®
Important but Never Discussed: The "in Case of Death Folder"
After recently watching "Fast Forward" on PBS, it spurred some additional thoughts for me and my clients - would my/their loved ones know where/how to access the documents and info needed should I/they die? Since there isn't a great name to call this file/binder/folder, we will call it the "in case of death folder".
Background and thoughts on Fast Forward.
The summary on PBS's website is this: "Discover how successful aging is possible when intergenerational loved ones are intentional about their needs, communicate from the heart, and prepare before a potential health crisis may occur." Basically, they interviewed a handful of parents and their kids, took them through a series of exercises that showed them what it would be like to be an 80+ year old. They put on "aging" suits that restricted motion and movement, glasses that restricted vision, and other things that provided common characteristics of aging.
My notes on the roughly hour-long documentary were that I guess I wasn't aware of how scared people are to discuss their end of life. There were folks interviewed in the doc that weren't even willing to discuss taking the steps to put together their end-of-life wishes. It seems like the current paradigm is that by talking about death, aging, end-of-life care/wishes does more harm than good for people. I wrote in my notes that I hope there is a paradigm shift - it's a GIFT to your family for them to know what to do and where to go in the event of a crisis, not a burden! When people age, they DO NOT become irrelevant. Aging doesn't have to be a deterioration process, it can be a growth process as well. Since most (all?) of my clients are older than I am, I see firsthand that the ones that stay the sharpest are the ones that have the most fulfillment in life - they have found their purpose and stay engaged in activities they care about.
The idea of fulfillment and purpose trickles down to younger folks as well. More and more, I've seen clients and prospects earlier in their careers talking about how they're working a lot of hours now so that they can have a hybrid "retirement" where they trade their time for more fulfilling work, but for less hours.
This idea is important to avoid burnout and maintain a long and healthy life.
But after all, life will end for everyone at some point. We know that's a fact. Old, young, somewhere in between - it's just how it works. So what can we do to make death less of a taboo topic?
Last week, I was having a conversation with a friend of mine who isn't a client. We often talk about financial topics and shoot the breeze about different stocks. He is very successful in sales and his spouse is a physician. He was talking about how he has accumulated some money in various accounts and also how he and his wife keep their money separate still. To use his words, "When we got married, I was broke and felt badly using her money..." Fast forward to today and he is outearning her, but they still keep their money separate on paper. I posed a simple question, "If you died, would she know how to access your accounts? Would she even know where to look?"
He answered, "NO."
I'll bet this is the case for the great majority of people.
The solution is to have an in case of death folder.
What is an in case of death folder you might ask?
It's either a physical or electronic folder that contains important information that your loved ones need to know when you die.
Some items that should be included are:
Will documents (and healthcare directive, so that your loved ones can access it should they need to make end of life decisions before you pass)
Insurance policies (policy numbers, amounts, etc.)
Investment account informations (account numbers, where the money is held (example: Vanguard, Schwab, Fidelity, etc.), account type (IRA, Roth IRA, annuity, etc.))
Contact information of relevant people (CPA, Attorney, Financial Advisor, executor of your will/trust)
Location of valuable possessions (jewelry, safety deposit box, etc.)
Bank account details
List of digital accounts and passwords
Cell phone code
Services on autopay
Major real estate owned (primary home, vacation home)
Where to access statements (if there is a mortgage)
When in doubt, include it
Like I mentioned above, it's a gift to your loved ones to know what your wishes are and where to access the important information regarding your life.
My favorite method to get this done is to have an electronic, password-protected folder (I use Dropbox). The loved ones you share the information with only have to remember the password, you can create subfolders to make everything organized, and you get peace of mind knowing that your family is taken care of.