Advice before you pass away

The worst part of my job as an advisor is hearing that a client passed away. It’s hard to lose a friend. Then there’s the uncertainty for the family left behind. Most people deal with the death of a loved one infrequently, which means they aren’t familiar with everything that needs to be done. My job is to make the process as easy as possible, but there is a lot that must be done. Having been through the process of retitling accounts after a death many times, let me give you two ideas that can make it easier for your loved ones.

1. Simplify everything you can in your financial lives. Keep investment accounts at the fewest number of institutions possible.
   • Don’t have stray IRA and 401k accounts all over the place. Each institution requires its own forms and has a separate process for retitling the accounts. That makes for a lot of work if you have an account here, there, and everywhere.
   • Don’t open accounts at multiple banks because a new bank offered you a cash incentive to do so (attaching a savings account to your checking account at the same bank is fine). Again, this just creates more forms during an already challenging time for those left behind.
2. Review your beneficiaries and estate plans annually. Make sure your accounts are titled properly.
   • If you have a trust, are your accounts in that trust? Make sure you don’t miss any accounts.
   • If your accounts are titled in your name, should they be joint accounts? Should you designate a beneficiary?
   • Do you have primary and contingent beneficiaries listed for all IRA/401k accounts?

That’s it. If you can do those two things, you will make things much easier on your family when you pass away. They will sing your praises. I will sing your praises.