Will 2014 be the year you do the right thing for yourself and your family
by creating a secure financial future? Here are four steps to help you
begin to take control of your financial life now:
Be willing to consider the worst.
Many people neglect their financial affairs because they are uncomfortable
thinking about the scary parts of life and especially the impermanence
of it. But in order to create a great financial life for you and the people
you love, you must consider the worst possibilities, including your own death.
The process of looking at what would happen to everything you love is way
more about living than it is about dying. Consider the worst so you and
your family keep control of your finances and make important choices about
how you want your assets managed and passed on to future generations.
Inventory your assets
Create a comprehensive list of all your assets and keep it up to date on
at least a yearly basis. If you keep and update your inventory, you will
always know what you have, your loved ones will know what there is if
anything happens to you, and nothing you care about will end up in the
State Department of Unclaimed Property with billions of other lost assets.
Most importantly, your loved ones will feel significant ease knowing you
are on top of what's most important. You handle this and they relax.
Assets include not only cash and investments but also real estate, insurance
policies, annuities, retirement accounts, collectibles and also intangible
assets, such as digital assets, such as your photographs, emails, and
even your Facebook content, values, insights, stories and experiences.
We can help you inventory and pass on those as well.
Once you have compiled your inventory, you can then start thinking about
how each asset serves you and who you want to benefit from each asset
you intend to pass along, whether it is a relative or a favorite charity,
and how you want them to live beyond you.
Create a plan to handle them well, no matter what.
One of the most important parts of financial security for your loved ones
is knowing that they can access your assets and know how to handle them
if something happens to you. While most people think a Power of Attorney
legal document is sufficient, it's really not.
It's just the authorization of who you want to make your financial
decisions if you cannot make them yourself, but it doesn't tell anyone
HOW to make those decisions. What are your values? How do you decide what
to invest in? How to invest? How to make the hard choices in your financial life?
Assigning powers of attorney and declaring how you want your financial
life handled is important for people of all income levels, because these
are the people you choose to carry out your wishes in the event you are
unable to make decisions for yourself.
Keep your plan updated.
Without a doubt your life is going to change, your assets are going to
change, and, yes, the law is going to change. So it's key to re-evaluate
your financial security plan at least once a year to ensure the decisions
you made still make sense. This is especially critical after a major life
change such as a marriage, divorce, birth of a child or death of a beneficiary.