Protect your wealth after you're gone: A guide for your loved ones

Joseph M. Dionisio, Senior Managing Director, Advanced Tax and Estate Advisor, Citizens Private Wealth.

Joseph is an Advanced Tax & Estate Planning Advisor with Citizens Private Wealth Management. Joe has more than three decades of experience as he’s worked with high-net-worth individuals (and families) and business owners to provide comprehensive personal financial planning services.

Throughout your life, you've taken steps to ensure that your loved ones are well cared for. You want to help protect them after you've gone and the certain that your finances are handled seamlessly and according to your wishes after you pass.

While many people don't want to think about their death, it's important to take steps now to prepare your loved ones for that eventuality. This guide will help you provide your family and loved ones instructions for handling your estate when the time comes. By providing instructions and organizing your documents, you'll be able to make things much easier for your family during what will certainly be a difficult time.

Keep your documents and financial records organized and updated

Make sure your loved ones know where your accounts and documentation are and how to access important information. Designate an area, such as a filing cabinet, for all of your most important documents. Make a list of:

• Important phone numbers: Put together a list of phone numbers of your trust and estate attorney, accountant, insurance agent and other advisors, plus extended family members, your local Social Security administration office, pension provider and your private banker.
• Bank account information: Write out the name and account numbers of every bank account you have. Keep in mind that banks often have different policies regarding the information required after the death of an account holder.
• Investment and other account information: Also provide the account numbers and information for any investment accounts you have, real estate, vehicle titles, deeds and life insurance policies. Include the location of any relevant documents, such as your car title or the deed to your home, in the list.
• Location of important documents: Put together a list of your important documents, including your marriage and birth certificates, your Social Security card and your estate planning documents. Include the location of these documents in the list.

Review your wills and trusts every few years, or after major life changes, to ensure they are up-to-date and relevant. Make changes to your Will/Revocable Trust as appropriate. You may also want to check the beneficiaries on your life insurance policies, bank accounts and retirement accounts. Seek the advice of a financial professional before making any changes to your estate plan.

Consider creating an emergency fund

Immediately following your death, your loved ones may not have immediate access to your estate. But, they will need to pay for your end-of-life needs, such as your funeral costs and other expenses, such as hospice care. To help bridge the gap, consider creating an emergency fund with enough money in the account to cover typical end-of-life expenses.

Consider making this a joint account so that your loved one, such as a spouse can access it after your death. Review the account periodically to ensure that it has adequate funds. You may also want to include living expenses for any dependents for several months in the account, as certain income sources, such as your annuity or pension may be discontinued after your death.

Prepare your loved ones

It's never an easy conversation to have, but make sure that your loved ones know exactly what to do after your death. By creating a list of actions items like: bills, insurance coverage, creditors and debtors, and assets, your heirs will have an easier time navigating the management of your finances.

Apply for death benefits

Your loved ones should act quickly following your death to notify the appropriate parties, so they can begin receiving benefits. For example, any life insurance policies you have you need to reach out to the carrier to request the death benefit. Encourage your loved ones to work with a private banker or private wealth advisor and set up the appropriate bank or investment accounts to receive these benefits.

Make sure your loved ones know about any potential death and survivor benefits they may be eligible for, such as:

• Employee life insurance
• Employee benefits
• Accidental on-the-job death benefits
• Veterans and military survivor benefits
• Medical benefits
• Personal or business life insurance

Also, tell them to set up an appointment with your local Social Security office to inform them of your death and settle any pending benefits. Have your loved ones notify your insurance company to stop annuity payouts or obtain other benefits.

Continue paying bills

Your family members will need to keep paying your bills after your death, until those accounts are closed. Instruct your loved ones to keep up with your mortgage payments, credit card payments, utility bills and tax bills, as needed. In your lists of important documents, leave behind records of what you owe and payment information for each account. Also consider including enough in your emergency fund to cover a few months' worth of bills after your death.

Continue health insurance coverage

If your loved ones are covered by your group health insurance plan, have them continue the policy after your death. If that isn't an option, remind them to purchase an individual health insurance policy. Also have them continue or transfer ownership of your car insurance.

Contact creditors and debtors

After a death, state laws vary widely regarding the time your loved ones will have to notify your creditors or debtors. Encourage your loved ones to consult a probate attorney or other legal counsel before they reach out to anyone who owes you money or to whom you owe money.

In the meantime, prepare a list of creditors for your loved ones, such as:

• Your mortgage company
• Credit card companies
• Car or personal loans
• Business loans

If you have lent money to others or have tenants, your loved ones will need to know how to work with them. Again, encourage them to contact legal counsel before taking any action, as state laws can vary considerably.

Transfer ownership

Your heirs will need to transfer control of assets to their own name following your death. If you own items jointly with a spouse or other family member, they will need to remove your name from the account. Ensure that your loved ones know to contact their private banker or private wealth advisor to transfer ownership of any banking accounts and their attorney to transfer any other assets.

Settle your estate

Your loved ones will typically have nine months from the date of your death to file estate tax returns and pay any taxes due. They'll also need to file your final income tax return. The IRS' website will have the most up-to-date information on specific deadlines. Encourage your loved ones to work with a private banker or private wealth advisor and set up the appropriate bank or investment accounts to receive these benefits. Have them work with an attorney to start the process of settling the estate.

Encourage your heirs to make their own plans

In the same way you're making your own plans for after you're gone, encourage your loved ones to do the same. As you walk your heirs through the process of settling your estate, encourage them to keep their own wills and estate plans updated, so that their end-of-life documents reflect their current wishes.

Be upfront with your immediate family about your financial situation and what they can expect once you pass away. If they are likely to come into a sizeable inheritance, encourage them to seek advice from a private banker or private wealth advisor to make the most of the money.

Contact your Relationship Manager for help

Not sure where to get started putting together a survivor's guide for your loved ones? Your Citizens Relationship Manager can help you compile a list of documents and ensure that all your financial ducks are in a row. Contact us today.