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Don't Put Off Getting Your Estate in Order

Last week I lost a loved one. During an extremely emotional time, I couldn't help but think how much easier the grieving process was thanks to some thorough estate planning.

My father-in-law passed away after suffering for many years from Parkinson's disease.

Fortunately, my mother-in-law was as well prepared for her husband's death as one can be. In the years leading up to his passing she worked closely with an elder care attorney and financial planner. After the funeral, when I asked if there was anything she needed to do or papers to locate, my mother-in-law looked calm and said everything was taken care of.

While estate planning is hardly top of mind for most of us during this recession -- we're too busy trying to save money and hold onto our jobs -- it's something all families need to do. If, like my mother-in-law, you don't want to spend what is often an emotionally trying time up to your eyeballs in paperwork, searching for important account numbers or figuring out how to keep money from getting stuck for months in probate, here are some helpful steps to take:

  • Make a list of all your bank accounts, retirement accounts, insurance policies and their corresponding passwords. Then make sure to tell your spouse or adult children where to find it. Also make sure to include the names and phone numbers for your financial planner, estate planning attorney and other professionals that need to be contacted should you pass away.
  • Draft or update a will. You may not realize it, but without this crucial document the state will decide what happens to your assets, not you. And if you have children, chances are your surviving spouse will have to split at least part of your money -- funds that he or she likely needs to live on -- with the kids.
  • Name a guardian in your will. If you don't formally decide who should take care of your young children, a judge will do it for you.
I know, you're thinking estate planning is often a lot more complicated. That's true. Many families, for example, will want to draft a trust and other important documents including medical directives and power of attorneys. But as I was reminded last week, everyone needs to start somewhere.

If you need some help getting your affairs in order, check out my favorite legal resource, the Nolo Web site. Nolo's section on Wills and Trusts can walk you through everything you need to know, including how to figure out if you have a simple estate and can basically draft your own will with the help of a software package like Quicken WillMaker or if you would benefit from hiring a professional. It also offers helpful articles, including one on organizing your documents.

Another good resource if you've lost a lost one is the AARP Web site and its page on Life After Loss. While searching through its vast library of articles I came across a useful checklist I'm going to send to my mother-in-law. It lists all of the things she'll need to do during the first six months after her spouse dies, including contacting Social Security about benefits.

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