DO YOUR FAMILY A FAVOR: GET THE PAPERWORK TOGETHER

June 1, 2010 – Jack Sirard contributing writer

Want to do something nice for your family and friends this year?

Get your paperwork in order.

As anyone who has had to go through a friend or relative’s piles of paperwork after they die can tell you, some simple organization as well as a few well-typed notes can make their lives a lot easier and often can save a lot of money.

I’ve talked to a number of people in recent months who, after losing a loved one, have had to step in and make sense of their estate. Usually the biggest problem they face is in finding key documents.

One friend of mine discovered a life insurance policy on his father a full two years after the man died. Others have had to put up with bill collectors, taxing agencies and even foreclosures on their relatives’ homes.

In many families, one person is more or less in charge of the money. He or she is the designated bill payer, collector of financial statements, handles the taxes and as often as not the family investments.

In our family, that’s usually me because of my long-time investment experience and the fact that someone has to do it. A few years back, I asked my wife what she wanted for her birthday and she told me all she wanted was a simply written document explaining in precise details where our money is, how I pay the bills and a list of accounts and where they are.

So I spent some time putting it altogether, making it easy for her to step in and handle the family finances on a moment’s notice.

I included everything from the names and contacts for our financial and trust advisers, the location of our safe deposit box key, how to know what our pin numbers are, what bills to expect that are not part of the monthly budget, etc. In short, I broke down our financial plan into a simple-to-use three- page document.

One of my best friends found himself in the unenviable position of being the executor of his aunt’s estate. Not only did she live in another state, but from all accounts she was a highly disorganize packrat who piled up boxes of documents throughout the home.

It took him literally months to go through her stuff. Packed away among the boxes were dozens of uncashed dividend checks, stock certificates and bills that may or may not have been paid.

He spent considerable time contacting each and every corporation in an effort to get a new dividend check as most had expired. He couldn’t immediately tell which bills had been paid and which had not. He filed her estate’s taxes as well as her amended tax forms.

And since he was the person in charge of making financial distributions to the heirs who wanted their money right away, it turned out to be a two-year nightmare for him.

While most families won’t face that much chaos in going through a person’s financial matters, it still can be a lot of work. You can make it much easier for your heirs by beginning to get all of your paperwork in order and sharing that information with a trusted family member or friend.

Jack Sirard, a retired nationally syndicated financial columnist, is a Senior Softball-USA writer/editor.