The beginning of a brand new year is an excellent time to review and update your estate plans, and doing this now will help to protect your loved ones and your assets later.
If you have a will, update it. If you don't, draft one!
Believe it or not, three out of five American adults don’t have a will. Your will should name a guardian for anyone under 18, and you’ll also want to name a trusted person as executor of your estate. Review your will every few years, or whenever you experience a life event, such as a birth, marriage or divorce.
Update your beneficiaries
Did you know that the beneficiaries listed on your 401(k), insurance policies, retirement accounts and investments trump your will? Review your lists of designated individuals and charities every few years, and be sure to choose contingent beneficiaries. Otherwise, if a primary beneficiary dies before you do, your funds will go to your estate, which can create tax and legal issues.
Assign a power of attorney
There are two types: financial power of attorney, which lets someone take care of things such as writing checks; and medical power of attorney, which allows someone to make decisions about your health care. Without these forms, your family members might have to go to court to handle simple estate or other legal matters if you are incapacitated.
Organize your paperwork
Do you know where your insurance policies, brokerage and 401(k) statements, and mortgage paperwork are? What about your online accounts and memberships? If you’re not sure, you can bet your loved ones won’t be able to find them when they need to, either. Put everything, including online passwords, together in one place and then tell a family member where that is. To receive an Estate Information Organizer where you can record all of this important information for your loved ones, please contact us at giftplanning@drexel.edu.
Questions?
Contact David Toll, JD, senior associate vice president, in Drexel University’s Office of Gift Planning at (215) 895-1882 or giftplanning@drexel.edu.