This is a question we get asked on a weekly, if not daily, basis. What information should you have on hand to help administer your estate or your parents’ estate? Where can I find account numbers, assets, passwords, etc.? This can be a much harder question for children to answer than parents. Typically, the parents know where all their assets and information is located and can often be a bit reticent to share it all with their kids. That said, a comprehensive list of helpful information is invaluable to your children and will save them many, many hours of stress.
There are two possible scenarios with regard to access to information when someone is incapacitated or has passed away: Scenario 1: There is a clean, clear list of assets, passwords, addresses, keys, legal documents, etc., or Scenario 2: There isn’t. Which situation would you rather be in? Which would you rather leave for your children? I’m going to start with the “bad” scenario and then suggest how it might be avoided.
Let’s say that you have developed dementia or you’ve passed away and the kids need to step into your shoes to manage things. How will they know where your assets are? Do you have one checking account or three? Do you have a single IRA or do you have multiple investments? Life insurance? A brokerage account? What is the password to your online banking? Do you have any credit cards? What’s the phone number for the lawn service? Who handles your pension? Do you have an estate plan? Do you have a lawyer? A CPA? An advisor? How could your kids begin to piece together the answers to these questions? This would be done through a very tiring process of checking the mail, digging through boxes and drawers, hopefully finding a business card or some clue. While I generally love scavenger hunts, it’s not a lot of fun rummaging through your deceased mother’s filing cabinet and trying to figure out which account the cable bill is being autopayed from.
So how do we avoid this? A very simple list can eliminate an incredible amount of guesswork on the part of the kids. These lists can be somewhat simple or quite elaborate. There are even services that work with people to help put such lists together. But even if you don’t wish to go quite so far as hiring someone to assist you with this, here are a few things you can put together in a document that will be invaluable to anyone managing your affairs in the event of your incapacity or death.
- All accounts and assets. This is a huge one and includes everything of financial value: checking and savings, IRAs/401ks, life insurance, annuities, brokerage accounts, stocks, bonds, investments, etc. You don’t need to include the values, as they fluctuate constantly, but account numbers and where assets are held is huge.
- Location of your estate plan and contact information for the firm that prepared it.
- Location of deeds to real estate as well as any mortgage or home equity loan information.
- Location of titles to vehicles, including terms for any leased vehicles or vehicles on a payment plan.
- The names of any important professionals, including your doctors, your attorney, your CPA, your financial advisor and anyone else who may need to be contacted.
- The location of personal paperwork, including your social security card, driver’s license, marriage certificate, divorce decrees, etc.
You certainly do not need to disclose all of this information to your children or executor now, but by compiling it into one central location and keeping it up to date, you save an enormous amount of time and stress when, not if, someone needs to take over your estate. They don’t need to know the specifics, they just need to know where to find them.
One last thing – two common places people store this information is in Excel style spreadsheets on their computer and in safe deposit boxes. They each have their benefits. Spreadsheets are easy to update and safe deposit boxes are incredibly secure. However, this can spell disaster if your children do not know the password to your computer or do not have access to your safe deposit box. Be sure that wherever you store this crucial information, the right people know where to find it and have access to it.
I know this seems like a lot. Most people only go through this once in their lives, but we help families going through this process every day. If you have questions about how to set up your planning and what information is needed, please don’t hesitate to reach out. If you’re interested in scheduling a no-cost virtual consultation with an attorney, please contact us a 1-800-ESTATES or at www.rutkowskilawfirm.com