
Okay, fact is, none of us likes to think about dying. So for the sake of discussing something critically important to your family, rather than talk about a more likely scenario like a car accident or another tragedy, we'll consider the event you are taken away in a UFO. A bit easier to chat about?
I'm in the insurance business. I talk with people every day about preparing for the unexpected. I give people advice everyday, including having an appropriate amount of life insurance and having a last will and testament. I have a confession to make: I still don't have a will myself.
For almost 4 years now Cara and I have been talking about this, yet continued to put it off. One decision that needs to be made, is who will take care of the kids if something happens to both of us (alien abduction)? We've finally settled on a couple of friends of ours. However, there still remains a number of huge considerations. As I work through these myself, I hope this is helpful for you:
For my wife and I's 8 year marriage, I've primarily been the money guy, paying bills, managing our income and savings, insurance, etc. It has nothing to do with Cara's ability to handle this stuff, it's simply been a matter of convenience- I naturally gravitate toward it with my business, so that's how we've taken care of things. If I die, without some significant planning, there's going to be a bit of chaos in store for Cara.
Here's my list:
1) What does Cara do about my business?
How do my employees get paid?
Is Cara a signer on my business line of credit?
Authorized user on my business credit card?
What does she do with the business long term?
2) Bill Payment
Does she have our password to Chase.com?
Is she familiar with all my payee Nicknames?
Does she know that our Home Equity Line is variable and she needs to adjust the automatic bill-pay occasionally?
3) Life Insurance Proceeds
Should she pay off the house or invest it?
How long before she needs to return to work?
Does she know how to contribute to the kids college savings plans?
Where should she put the money- I've been the investor up to this point?
These are just a handful of the questions she'll be faced with almost immediately in addition to the grief and pain of loss, and being a mother to our kids.
I want to minimize that. This morning, I met with a trusted friend and fellow business owner, and began a discussion about him being my proxy and trusted contact for my wife in the event of my death. We talked about me having that same role with his family. It requires an enormous amount of trust.
Here's what I'm considering doing: (I'll be consulting an attorney friend of mine before implementing this plan and I'd urge you to do the same.)
1) Make this person a signer on my bank accounts and authorized user of my credit cards- If something happens, I want this person to instantly be able to step in and help take finances off my wife's plate. Initially. I don't want her to have to stress about "figuring everything out" right away.
2) Disclose all my passwords to banking and investment sites, email, flickr, social media, etc.
3) Give access to my business affairs and meet annually specifically to update this data- balance sheet, cash flow, payroll, accounts, available credit, etc.
4) Provide a summary of all our insurance and financial affairs. Everything.
5) Develop a summary of my principles and values to guide and provide clarity for all other situations that might arise.
At this point, some of you are probably thinking I'm crazy. Maybe you're one of those people that has decided you can't trust anyone. That's not me. I've carefully vetted this person over years and am confident if we make this agreement, my wife and kids will be watched over and cared for just like his own wife and kids.
This will take a fair amount of time, but I love the fact that if something happens to me, I've already planned for a best case scenario for my loved ones. A really hard situation will inevitably be a little bit easier with some forethought.
Already in my career I've had several death claims. Take my word for it, one of the most loving and practical things you can do for your family is have life insurance, a plan, and an advocate identified to help guide your survivors through the long transition.
If you're abducted by aliens, do you have a plan?