Preparing for the worst

If you were killed or incapacitated in a car accident, if you had a stroke or heart attack that put you out of commission, would the people who had to take over your affairs know where to start?

Would they know where your bank accounts are? What insurance you have? Where your paycheck is deposited? What bills have to be paid? And if you have minor children, will friends, relatives, or the authorities know where you want the kids to stay?

If the answer to any or all of those questions is either “no” or “I dunno,” now is as good a time as any to start writing down the answers. I’m in the process of compiling a complete record of all the things my son will need to know if anything happens to me. It’s a pretty big job, one that will take several days to complete. The product will be two three-ring binders, one to keep at his house and one to keep at mine.

Here’s what’s going into it:

1. My employer

Healthcare card (whereabouts; ID number, group number)
…..User names and passwords*
…..URL of page to access pay information*
Amount of my salary
Benefits
COBRA and how to get it

2. Community colleges

Salary for adjunct teaching
…..User names and passwords*
…..URL of page to access pay information*

3. Insurance: vendors, policy  numbers, and telephone numbers

Health
Life
…..Including credit union & other groups with membership policies
Homeowner’s
Automobile

4. Credit union

Accounts
…..Direct deposits
…..Automatic transfers
…..Location of statements
…..User name, password, & URL for online access*
Automatic bill payments
Hard-copy bill payment
Credit-card payments

5. Credit cards

List of credit-card vendors and customer service numbers
Photocopies of cards, front & back

6. Social Security

List of necessary documents, and where to find them
Instructions for how to get SS started
Phone number and address of local SS Administration office

7. Medicare

Documents needed to start Medicare; location of originals
Information on how it works
Instructions for what is desired

8. Investments

Whereabouts of statements
Contact and phone number at management firm
Usernames, passwords, and URLs to for online access*

9. Financial records

Personal
…..Quicken
…..Excel
Corporate
…..Excel
…..Quicken
How to generate tax reports in Quicken & Excel

10. Lawyer/tax preparer

Name, phone number, e-mail, & address

11. Taxes

Whereabouts of past income tax returns
Taxes for S-corporation
Property taxes; fund for paying

13. Deed to house

14. Will

15. Living Will

16. Doctor

Name, phone number, and address

17. Dog

Feeding, care, eccentricities
Veterinarian’s name, phone number, and address

18. Downtown house

Loan documents
Homeowner’s insurance policy
Legal documents

19. Blog

Username, password, & URL for dashboard*
Adsense
…..Username, password, URL*
…..Arrangements for pay
Bluehost
…..Username, password, URL*
Name & contact of tech consultant

20. Freelance clients

Names, phone numbers, e-mails
Instructions to advise that deadlines will be missed
Where to find work in progress
Name & e-mail for subcontractor(s)

21. Final arrangements

How to dispose of the remains

* Important: Don’t save any pages with this information to a computer or a flashdrive. As soon as I finish typing a section, I print two copies for the two binders and then close the file without saving. Another strategy: simply delete the sensitive information before saving to disk…but be sure you’ve erased every reference to a Social Security number, user name, password, or any other vulnerable data.

Kids

If you have minor children, you should make arrangements for someone to care for them should both parents be killed or incapacitated—something that could easily happen in a car wreck. Decide who should be the caretakers and discuss it with them. Once they’ve agreed to take responsibility for your children in an emergency, put it in writing. Have them sign it and you sign it in front of a notary public. Give them a copy and keep a copy for your own records. If the person who will take charge of your affairs is different from the person or couple who will care for the kids, be sure that person also has a copy.

You should also name the desired child caretakers in your will. The person who is to take charge of your affairs should be named as your will’s executor, unless your lawyer advises otherwise.

If you have sole custody of children from a divorce and you do not want the child’s other parent to assume custody in an emergency, you should state the specific reason that this is undesirable (abusive? drug user? alcoholic?) in the document that designates the emergency caretaker.

Security

By the time you finish, this binder will contain some very sensitive information. You don’t want it to fall into the wrong hands. My son is very responsible, and so I feel comfortable about giving him a binder full of printouts containing my Social Security number, usernames, and passwords; however, my name and address will not appear in the thing. If your adult children can’t be trusted, consider hiring a lawyer to handle your personal affairs and storing the information at her or his office. Alternatively, choose a trustworthy friend or relative, ask him or her to take charge in an emergency, and give that person the information.

Surprising, isn’t it, how much a person needs to know if she or he is to take over your personal affairs in a pinch? My life is quite simple: no minor children, no child custody decrees, no alimony or child support, uncomplicated investments, no special healthcare issues, no homeowner’s association, no mortgage or rent, no employees, no vacation home, or the like. A young or middle-aged couple or a single parent’s data would be considerably more involved.

As circumstances change, you’ll need to remember to update certain pages. If you’ve saved those pages that contain no sensitive information, this task should be fairly easy. If not, you’ll have to retype entire pages…a hassle, but better than having them reside on a computer that could be hacked or stolen.

Plan to spend several days to a week thinking through and compiling the information another party would need to access important accounts, pay your bills, get  your insurance to cover your costs or collect life insurance; deal with doctors, lawyers, and your employer; care for your property; and find accommodations for your children and pets. With any luck, it won’t be needed. But if it ever is needed, someone will thank you.

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frugalscholar August 23, 2009 at 1:44 pm

My mother was shocked to discover that my father, a very messy fellow, left very neat files, with instructions for her. A relief after a sudden death.

One thing I’d suggest: anyone planning to leave an IRA to a child should learn the rules of distribution and then educate the child. These can be gifts that keep on giving (both Roth and regular) but many people mess up. The book on this is by someone named Schott, I believe.

I think the basic deal is that the child can take distributions based on his (longer) life expectancy. With a Roth these are tax free, also.

My father divided his Roth IRA into 4 pieces and put each of his grandchildren as beneficiaries of one after my mother. If she ends up not needing the money, this will be a wonderful lifetime gift for all the kids.

Wojciech August 23, 2009 at 3:45 pm

What a fantastic list! With a child on the way, I have to get myself together and start the assembly process for something similar.

It always seems like we don’t have the time, but this is oh-so-important.

Thanks for a great resource and starting point!

Revanche August 25, 2009 at 8:41 pm

Oh how nice, I’m fingers deep in creating the same sort of documentation for myself. The work stalled when I realized that I needed someone to hand it off to, but I don’t have anyone I trust enough to handle/protect such sensitive material. I may look into the possibility of a safe deposit box with instructions to send the key or provide the key to a designated responsible party.

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