If you have a will, update it. If you don't, draft one!
Believe it or not, 67% of American adults don’t have a will. If you own any valuable assets — including a house, a car, artwork or a bank or brokerage account — or if there are people who depend on you, you should have an estate plan in place. Your will should name a guardian for minor children, 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 those named in 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: a durable financial power of attorney appoints someone (known as your “agent”) to manage your finances for you if you ever become unable to do so for yourself; a durable healthcare power of attorney allows someone to make decisions about your health care if you are incapacitated (and doctors and family members may be making the decisions for you). Without these forms, your family members might have to go to court to handle simple estate or other legal matters if you can’t.
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 this important information for your loved ones, please contact us at giftplanning@drexel.edu.
Have questions? Contact David Toll, Senior Associate Vice President for Gift Planning, at (215) 895-1882 or giftplanning@drexel.edu.