Estate Planning, What To Do When Someone Dies

 

When someone we know dies it causes feelings to surface inside us. We start wishing we had told them something or maybe we wish we hadn’t. We all hope for just one more day with them. No one can plan when our time will come or even why it came at all. We are never prepared for the end of happiness, sadness, or just nothingness. We need to remember that our time could be today and start doing and saying what we always wanted to. We need to start living now.

What we also need to start estate planning. When someone dies we should learn from their passing. We need to understand that years fly by so quickly and we need to make the most of them. We also need to learn to prepare for death. I understand no one likes to think about this. I believe in general we only want to think about temporary problems not permanent ones and this is why we avoid death.

When someone dies that either I knew or someone close to me knew, I start thinking. It sets me in organization mode and I recheck my paperwork to make sure everything is still in order and that nothing has changed. As much as I don’t want to think about death, I really don’t want my family dealing with my loss and having to handle everything. We make hasty decisions based on what our heart tells us and not our head during times like this, thus we are taken advantage of.

A few points to think about are; do you have a will, what about P.O.D. accounts, are your vehicles listed as (or/and), are your beneficiaries up to date, does your house have life insurance and more? As I learn and make changes to my own situation I feel the need to share this with you. I want your family to only be concerned with your loss when you are called to Heaven. I don’t want them to have to grieve later because they were so busy dealing with technical issues. And I really don’t want your family to become a victim during this time because they made purchases with their heart and not their head. Get your life/ death in order now.

I believe there are many reasons for death. One is so the living will start living. We become so complacent with ourselves that we just go through the motions and we forget to realize how lucky we are to be here for even one more day. Another reason for death is to learn from what happens to those who die and better prepare our family for it. And the final reason, one that my dad told me years ago, is because if we don’t die new ones can’t be born. When you think about death this way it isn’t as hard to deal with. It gives us a calm feeling thinking about a baby coming into this world. This is possible because someone was called to serve in Heaven.

So let’s prepare and show our loved ones just how much we do love them. First of all, do you have children? If so, you are already blessed because they are miracles, treasure them. My husband and I have two children and we want to make sure they are taken care of if something were to happen to me. What my husband and I did was get life insurance for our house. If something were to happen to either of us or both, how would our children pay the mortgage? I don’t want their family home taken away from them. Life throws us curve balls but we don’t have to upset the entire applecart.

Our lender offered life insurance, but not for us, it was if something happens to either of us or both our house would be paid off. The beneficiary is actually the mortgage company and the money would go directly to them. It covers the exact amount owed at that time. How it works is this; I pay the mortgage each month and extra money is added to the bill for the insurance. It shows on the statement validating it is still active. The lender moves the money to the insurance company for payment of the home insurance. If something happens to us, the lender gives the insurance company the payoff amount and they pay it directly to the lender. Our house is paid in full.

I chose this option in addition to standard life insurance because I don’t want to put the burden on someone to make the payments until an outside company decides to cut a check. Then the check must clear and payment sent. Not everything goes as planned and I wanted to make sure this was as easy as possible, no middleman.

Another change I made was to add P.O.D to my bank accounts. In the event that something were to happen, these accounts do not need to wait for probate. P.O.D stands for payable on death. When the account owner dies the person listed as the P.O.D becomes the owner of the money in the account. Simply show proof of death, which the funeral home can assist with, and collect the funds. No questions asked. This frees up money for funeral arrangements (if not prepaid) and also to handle any outstanding bills that might be incoming. I leaned this from my mother who worked in banking for over 30 years. Thank you mom.

From my dad I learned to always have vehicles/ houses listed as (OR). The reason for this is a technical one but can be very costly if ignored. When a vehicle has two owners and one dies the vehicle might need to be sold. In order to do this both parties would need to sign if the documents read (and), however; if the documents read (or) you can make a decision without the consent of the other person. This can be both good and bad. I guess if both owners are not of the same mindset something could be sold without you agreeing but it is very helpful when a person dies to be able to make decisions without needing proof and hassles. Thank you dad.

A will is valuable especially if you have children. Write a Will,  it documents exactly how you want your estate divided. It also explains who will take care of your minor children in the event they need a guardian. Remember wills go to probate and if someone decided to cause a problem, they can contest it. This could tie it up for a long time which can become costly with court fees. It is always better to handle your estate in the ways I listed above than to rely on a will.

Since 2007, when my father-in-law passed away, we have been dealing with his estate which is still in probate. His wife received a higher portion of the property and did not want to sell it even though all three sons wanted to. She was going to pay them off however; she low balled the amount she wanted to give them and no one accepted. She wanted to rent the property and all of them divide the taxes and maintenance costs. The property is in another state and keeping track of everything would be rather difficult. To this date no decision has been made and the court fees are adding up. Recently a judgment has been placed on the property as well, probably making the value at less than $0. Remember, he had a will. Have a will but remember that just because you document your wishes they are not set in stone.

Many of us have life insurance either through our jobs or through a company we purchased from. Check to make sure you have someone listed and that they are still the same person you want listed as a beneficiary. Divorce, separation, and death happen yet we continue to go about our daily lives thinking everything is covered only to realize that the people we want to receive something is not even listed as the beneficiary. Please check into this. Make sure you have all the correct addresses and phone numbers for the Life Insurance Companies as well. We will discuss this later.

When it comes time to redeem a life insurance policy it can be difficult. Remember they sell millions of policies and don’t know you by name. You will need the policy number and as much information as possible when dealing with them. Make a physical folder or an online folder containing any Life Insurance Policies you may have and highlight the policy number for easy identification. Also include a phone number, don’t use the main number as it directs to a million different departments, but rather the actual department that handles payments. If you have an online folder make a note where the documents can be found. Do this with retirement benefits and any other paperwork that might be needed.

legal forms

Tip: Order at least 5 death certificates. Establishments will require them but most will not return them to you and they take over a week to receive in the mail.

If you need more proof about what you just read, see this article. You won’t believe what happened when this man tried to leave $400,000 to his children. If only he had taken a few extra minutes to fill the forms out carefully.

It is so easy. Simply download the forms by clicking on the blue box above to get started. 

Now death isn’t everything…..we still need to live, yes that includes financially. Part two of Planning, click here.

 

Posted by Vicki Brown in Estate Planning