Show #268 Airing Sunday, September 5, 2004
A client came in to my law office last week. She brought a filled plastic garbage bag. If you think that’s strange, I told her to unload the contents on my conference room table.
This actually is not so unusual. The client’s mother had passed away, and her daughter had no clue what assets she had. The mother had always been a private person, never telling her daughter about her finances. So the daughter had to play Sherlock Holmes to try to figure out what her mom owned.
After her mom died, the daughter carefully went through her mother’s home on a financial scavenger hunt. She was looking for bank and broker statements, insurance premium notices, tax forms, and anything else that might be a tip off to her mom’s assets. Then she brought everything she could find in to me to help figure out her mother’s estate.
In this case, I think we found everything. But it was a real time consuming hassle. And in many cases I’m sure that some assets are never found. The State of Ohio winds up with millions of dollars of assets that are lost to the families.
So what can you do to help your children or other heirs find all of your assets after your death? The best way is to talk with your heirs now, before you die. Tell them what you have and where it is.
But many folks want to keep their financial affairs private while they’re alive. And that’s understandable. Telling your children about what you own may invite your kids to stick their noses into your business, and to try to take control, while you’re still above ground.
If you’re not willing to talk about your finances with your kids, here’s the next best strategy. Organize your assets in one place. Make a list of all your bank accounts, stocks, bonds, money markets, real estate, life insurance, annuities, anything you own. Attach copies of the account statements, stock certificates, insurance and annuity policies, and deeds to property. If you have a safe deposit box, keep the key with these papers.
Also keep your will or trust in the same place. And make a list of important people who may help your family when you’re gone. Include the names and phone numbers of your accountant, doctor, financial advisor, and of course, your lawyer. Put this list and backup material in a file cabinet, or a box, or even in a kitchen cabinet. One client of mine put her “going away” materials in a suitcase, which she kept in the family room. Whatever you put your papers in, label it clearly, so someone coming into the home will know what it is.
Then tell your executor, the person you’d like to handle things when you die. Tell him that you’ve created a “going away” file, and where it is. You don’t’ have to reveal anything specific about your finances. But at least tell him that you’ve created a list, and where it can be found.
If you keep financial information on your computer, you’ll also have to tell your executor where to look on your computer, and your passwords.
Now, if you are the child listening to this, talk to your parents. Ask them about their finances. Tell them that that lawyer on TV told you to ask.
If they refuse, or if you don’t feel right asking, then at least suggest that your parents organize their finances and make a list. This is something loving parents should do for their children. The heirs should not have to quit their jobs and devote months of their lives to becoming Sherlock Holmeses to handle a parent’s estate at death.
