Plan ahead so chaos, conflict and cost aren’t part of your legacy

Mr. Kim is the Chief Operation Officer and Chief Compliance Officer for Kirr
Marbach & Co. LLC, an investment adviser based in Columbus IN. Please visit
www.kirrmar.com <www.kirrmar.com> .

One of the many “life lessons” the pandemic has reinforced is the
end-of-life (or becoming incapacitated from injury or illness) can come at
any time, a topic nobody wants to think or talk about. Unfortunately,
failing to plan for your end of life or incapacity can add unnecessary
suffering for your loved ones during an already emotionally traumatic time.

Fortunately, if you’re willing to face the fact you’re not
going to live forever and invest a few hours of your time upfront, you can
give your loved ones the gift of making your end of life just a little less
painful.

If I can do it, so can you.

Ideally, you want to have a binder or folder containing documents and
information your “team” will need that is well organized and easily
accessible. My friend “Pete the Planner” Dunn refers to his as “The Pete’s
Dead Binder” or “PDB” for short. As Pete says, acknowledging your eventual
expiration isn’t macabre; it’s pragmatic.

Many people think only the wealthy need a will, but if you die “intestate,”
meaning you don’t have a legal will, state laws (not your wishes) dictate
how the assets you’ve worked your entire life to accumulate will be
distributed. Unfortunately, only half of Americans have a legal will, which
is a recipe for disaster.

There are a couple reasons inexpensive, online “do-it-yourself” wills can be
pound foolish. First, it can be worse to have a poorly-written will than no
will at all. Second, if there is noncompliance with strict witnessing
rules, the will is void. Given the critical importance of getting this
right, it’s a good investment to get the best legal advice you can afford.

Celebrities including Prince (57 at death), Michael Jackson (50) and Aretha
Franklin (76) all died intestate with estates worth tens of millions, which
led to acrimonious, multi-year court battles pitting heirs against heirs and
enriching the lawyers. Zappo’s founder Tony Hsieh (46) died a billionaire
and intestate weeks ago, reportedly leaving behind only thousands of Post-It
notes listing assets owned and obligations owed.

A durable power of attorney gives someone else the authority
to act as your “agent” and make legal and financial decisions should you
become incapacitated.

A health care representative is someone you designate to
make medical decisions on your behalf if you are unable to make them
yourself.

A living will or advanced health-care directive gives
specific instructions regarding end-of-life care. Do you want to be
resuscitated if your breathing or heart stops? Do you want to be kept alive
through artificial respiration or feeding?

You should also keep a comprehensive inventory of your
“stuff,” including

* Life insurance policies (policy numbers, beneficiaries (make sure
current), amounts and agent info)
* Bank/investment accounts (account numbers, amounts and contact info)
* Retirement accounts (account numbers, beneficiaries (make sure
current), amounts and administrator info)
* Personal property like real estate and vehicles, including related
debt (account numbers and amounts)
* User IDs/Passwords for your online accounts, phone and computer
(consider an online password management tool)
* Location of safe/safe-deposit box, combination/key and list of
contents
* Creditors (account numbers and amounts)

I keep my inventory on an Excel spreadsheet and update it every January,
after I’ve received year-end statements. I give copies to my wife, our
estate attorney and trust company we’ve retained to handle our affairs when
we’re both gone. It hardly takes any time and then I’m good to go until the
next January (hopefully!).

If the task seems too daunting, don’t despair. There are a number of
resources that have been developed specifically to assist you. The first
resource below has a digital, type-in version while the last two require
handwritten entry.

* Mark Gavagan wrote the workbook “12 Critical Things Your Family
Needs to Know” (www.12criticalthings.com <www.12criticalthings.com> )
so your loved ones know “what you have, where it’s located and what your
wishes are.” As the author’s courtesy to IBJ readers, use code “IBJ” for
30% off the print or digital, type-in version.
* Erik A. Dewey wrote “The Big Book of Everything” (free online
<www.erikdewey.com/bigbookmkII.pdf> ) after going through the
difficult experience of locating/sorting/organizing his father’s stuff.
* Sally Hurme, an elder law attorney with AARP, wrote “Checklist for
My Family: A Guide to My History, Financial Plans, and Final Wishes.”

It hopefully won’t be needed for many years, but creating your end-of-life
“roadmap” can be one of the greatest gifts you can give your loved ones.
Let love and caring be part of your legacy.

The opinions expressed in these articles are those of the author as of the
date the article was published. These opinions have not been updated or
supplemented and may not reflect the author’s views today. The information
provided in these articles does not provide information reasonably
sufficient upon which to base an investment decision and should not be
considered a recommendation to purchase or sell any particular stock or
other investment.