Everything your family needs to know when you die
By Thomas Heath
The Washington Post
Sunday, June 10, 2018
Tax season is over. School is ending. Summer is here.
Things have slowed enough to gather yourself and get organized.
We call it the Big Book in my family. Invented by my scrupulously detailed father-in-law, the Big Book is the index containing a road map to everything we own.
The wealthy have family offices to track these things. For the rest of us, there's the Big Book.
It includes life's important documents, including driver's licenses and insurance policies, investments and real estate deeds. Photocopies of passports, credit cards and wills. It has lists of "stuff," from the artwork your mom left you to the Oriental rug that has been in the family for three generations. It lists the antique Singer sewing machine, silverware and the Haviland china. It might even include the Redskins season tickets that have been handed down since the days of George Preston Marshall.
The Big Book could be a three-ring binder resting in a safe place or a virtual vault locked somewhere in the cloud.
"I call it a master directory," said Christine Benz, director of personal finance at Morningstar. "That's kind of a fancy name for something that's really quite simple. Having a resource like this and keeping it up to date is just such a valuable component. The crucial benefit is in case you become disabled or if you pass away, your loved ones will have some sort of blueprint for your financial assets and financial dealings."
Jamie Cox of Richmond-based Harris Financial Group calls the exercise "Financial Planning 101. Making sure you are organized is the most fundamental principle of financial planning."
Here are some suggestions I have compiled from my own family, as well as others, including lawyers, financial advisers and investment gurus.
The first section should include copies of "important documents."
These can include agreements with professional services such as a financial adviser, lawyers or accountants detailing the extent and cost of services rendered.
The important documents section might also include copies of passports; anything you keep in your wallet, such as AAA memberships, work IDs, credit cards and Metro fare cards; and your marriage license, birth certificates, and Social Security and Medicare cards.
In our house, we — well, my wife, really — organized a section called "Real Estate & Automobile."
This includes what you think it does: the contract with our cooperative building, where we own shares; our homeowners' insurance; the title, registration and insurance policy to our car. My wife even included the backup for the E-ZPass because it would have to be canceled if we got rid of the car. Home warranties and the like would also go into this section.
The next three sections of most Big Books can detail any bank accounts; investments, including stocks and mutual funds; and, finally, a list of retirement accounts.
This is important stuff, and the sooner you do it, the better your chances of achieving financial independence.
"The average American is so disorganized and has no idea what their true net worth and true holdings are," Cox said. "But getting organized gets you focused, and once you realize what you have, it's easier to have a plan about where you want to go."
If you own stock, mutual funds, savings accounts, money markets or have a retirement account or some other financial assets, you might want to list them next. You can call one "Taxable Investment Accounts" and the other "Retirement Accounts," because some assets are inside employee benefit plans that might require different procedures to access.
Don't forget to include your custodial information - account numbers, etc. - for your pension plans, if you are fortunate enough to have one.
Washington estate attorney Michael Curtin said one of the most important parts of preparing the Big Book or any other estate legacy is to find a home for your digital sign-ons and passwords.
"We all live in this crazy, password world now, and it's a tricky thing," Curtin said. "People ought to provide all of their passwords in a safe place. They should have some language in the will or trust that allows the fiduciary (estate attorney) to access all of those passwords and accounts. People have Apple accounts, Fidelity accounts, Amazon accounts that are password-protected. Those accounts can have money and assets in them."
Or maybe they just have family photo albums or travel pictures from past decades.
Next on your list should be insurance policies. Because my wife and I are in our 60s, we have a section titled "Long Term Care Insurance." I recently bought a long-term care policy, and my wife has one through her employer. My purchase was a big chunk of change, but after watching family members liquidate assets to cover home care, we decided long-term care is prudent.
In addition to long-term care policies, you might want to list separate sections with headings for "Life Insurance" and "Long-Term Disability." You can buy these independently or through an employer.
You might also want to list any and all of your health-care providers, physicians, medications, etc. You might also want to list family and friends, in case both spouses go at the same time and the lawyer or police need to notify others.
The rest of our Big Book is rounded out with credit cards and loans. Country club memberships, which can include stock holdings in the club, can also go in this section. So can gym memberships, etc.
Other assets could include jewelry, china, art, furniture, baseball card collections, rugs, etc. and — most valuable of all — my to-die-for Washington Nationals tickets.
If I could, I would take the Nats tickets along to the Pearly Gates.
What goes into your Big Book
• Important documents, including copies of passports, work IDs, marriage license, birth certificates and Social Security cards
• Real estate and automobile paperwork, including insurance, title, and registration and warranties
• Bank accounts and investments, including stocks, mutual funds, and retirement account numbers and custodial information
• Digital sign-ons and passwords
• Other insurance policies and estate-planning documents
• List of health-care providers, medications and emergency contacts
• Credit cards and loans
• Other assets