In March, I shared a family legal structure. Even with that structure in place, there will be significant admin for your family to sort when you pass. This admin will hit your spouse and children when they are least equipped to deal with it.
Given that people are useless at administration when they are grieving, how can you make life easier for your family?
Simplify possessions, portfolios and personal legal structure. Almost everything we have will be sold, donated or disposed. Streamlining yourself, in advance, is an act of love that will save your kids days and weeks of effort. If you have mementos that are special to you then sit down your kids, and grandkids, for storytime. Use the pictures and personal effects to make your history, their history. Without this effort, your memories will end with your passing. Your kids will treasure their memories when you pass.
Brief your successor(s) – consider the roles that you play in your family (financial, administrative, emotional), who’s backing you up? Do they know it? Have you explained their role to them? Do your successor(s) have written plans and checklists to work through? It’s far easier to update an existing plan than to create one when you’re under the stress of an unexpected event.
Establish A Joint Operating Account – Start with a joint operating account with your spouse. As you age, consider a joint account with your most reliable adult child. In my family, at least half of us have bodies that outlive our minds. It’s very likely that I’ll need to hand off to one of my kids at some stage.
Consider Medical and Financial Powers of Attorney – These roles require different skill sets – consider splitting. Have an honest conversation with the individual you’re considering to help you out. Are they willing, and able, to fulfil their role.
Consider Probate – If you died today then would your estate require probate? What are the costs, and disclosure requirements, associated with probate in your locale? Are you OK with that? What are the steps necessary to avoid probate?
Clear Instructions – make your Will crystal clear, simple and easily available when you pass. Brief your executor, and personal representative, well in advance.
Proactive Disclosure – Hold meetings with your financial/admin attorney, your medical representative and your spouse. I’m 44 and have a quarterly state-of-the-family meeting with my succession team. Not because I expect to die anytime soon, rather as an insurance policy to lessen the blow on my loved ones if I’m taken out at short notice.
Sorting the above doesn’t make coping with death easy, but it does go a long way towards reducing the chance that your survivors are overwhelmed, or ripped off.
Be very careful with financial powers of attorney and signing rights over your assets. I’ve seen fraud within families and between lifelong friends. Establish structures that limit the ability to one corrupt individual to hurt your family. Remember that even competent people make mistakes.
When you think you’ve got everything sorted – try explaining it to a trusted friend. Once you’ve explained it to your pal, have them explain it back to you. I guarantee you’ll learn something.
Three tips for estate planning:
- Say what needs to be said, today.
- Be a hero now, not when you pass.
- You’ll get the greatest satisfaction from sharing gifts (in person) with the people you love.
Denver Bar Association: what to do when someone dies
Colorado Bar Association: personal representative and trustee under probate