The beginning of a new year is a time when many of us make a fresh start. As you start to pull things together for your tax return preparation, it is a good time to look at your financial record keeping. Were you organized last year in ways that made things simpler for you? If your 2012 system was piles of receipts here and there, maybe your 2013 system can be folders for medical receipts, charitable contributions, and other items.
Maintaining Your Privacy
As you get annual privacy reports, take a moment to read them. If you want to cut down on unwanted mail, tell companies you do not want your information shared. When getting a medical test I read the privacy policy and was surprised that I was agreeing to receive fund-raising solicitations from the hospital’s foundation. As the privacy policy provided, I wrote a letter to opt out of those solicitations.
Who ARE Your Beneficiaries?
If you haven’t checked the beneficiaries you designated on your life insurance, retirement plans (IRA, 401(k), etc.) or health savings accounts (HSA) lately, this is a good time to do so. Contact the company to have copies of your designations sent to you, so you can make sure they are still what you want. Too often designations are made, never looked at again, and are outdated. Have you named a successor in case your primary beneficiary does not survive you?
One Size Fits All or YOUR Own Plan?
Have you had your own estate plan prepared or are you relying upon the one drafted by your state legislature? State law provides a default estate plan for everyone. Does your state’s match what you want? As an attorney who drafts estate plans, I can tell you that for most people, it doesn’t.
What Do Your Estate Planning Documents Say?
If you have put your estate plan in writing, do you know what your documents provide? Whom have you named to make your medical decisions if you cannot communicate? Have you provided copies to all of your health care providers and also the agents you named? Your instructions cannot be followed if doctors don’t know about them. If you become incapacitated, do you know how your bills will get paid? Who is to administer your estate?
Where ARE Your Estate Planning Documents?
Do you know where your original documents are located? Having an original Last Will and Testament when there’s a death is very important. Original Wills can be lodged for safekeeping for a very minimal cost for most Virginia residents ($2 each) and all Maryland residents ($4 each). Regrettably this option is not available in DC or in some Virginia counties. Your Will is then accessible only by you or the person you’ve named in your Will who has your death certificate. In many places if the original Will is traced to your possession and it cannot be found, the presumption is that you destroyed it, not that it simply went missing. Then those trying to handle matters are forced to petition the court for permission to use a photocopy, a costly and time-consuming process.
Is Your Trust Funded?
If your estate planning includes a revocable trust, have you transferred assets to it? A funded trust means that if you ever became incapacitated that your successor trustee could use the trust’s assets to take care of you. Additionally, assets owned by your trust are not subject to probate.
Get Answers
If you don’t know the answers to these questions, or you have other questions, then it is time to add one more thing to do, contact an estate planning attorney.
