In most families, there is one person who handles the finances and paperwork. What would happen if that individual were suddenly in an accident? Does anyone else know where to find the deed to the house, the title to the cars or the insurance policies?
This is especially a problem when an elderly individual is living alone. Do you know where your elderly parents keep their documents? Do you know details about assets they own?
Here is a simple way you can be prepared for life-changing events in your family. Get a sturdy binder and some page protectors. Gather the following information and put each document in a page protector. For added convenience, add a table of contents to the beginning or add tabs to categorize the documents.
Bank accounts – Insert a copy of the front page of a statement from each bank account showing the name of the bank and the account number. Be sure to include checking, savings, money market and CD accounts.
Investments – Insert a complete copy of a year-end statement from each of your brokerage accounts. Don’t forget IRA, 401k and other retirement accounts.
Deed to house – Put a note in the file indicating where you keep the deed to the house and other real estate.
Mortgage and loans – Insert a copy of a mortgage statement and other outstanding loan or credit card statements.
Titles to vehicles – Indicate clearly where you keep the titles.
Insurance Policies – Be sure to include identifying information on life, medical, disability, vehicle, homeowners, etc. You need policy numbers, owner, beneficiary and insured details.
Passwords – How would your heirs ever figure them out?
Advisors – Include a list of your advisors and their business cards. This would include your accountant, attorney, banker, financial advisor, insurance agent and other contacts that would be helpful to your family. This list could be the most valuable part of your notebook.
Other Assets – Identify any other important assets and include the information that will assist your executor.
When you are done, photocopy or scan everything and keep the copy in another safe, secure location.
This binder is no substitute for a will and living trust! You need one, and it should be revised every five years.
Review the notebook annually and update for any changes. A little time spent now could save much time and frustration later. Preparing now can give everyone a greater sense of peace and security.
Ronda Gardner, CPA is a senior tax consultant at Hawkins Cloward & Simister, one of Utah’s largest independent accounting firms. She is a past president of the local chapter of the Utah Association of CPAs and currently serves on the board of the Utah Valley Estate Planning Council. She and other CPAs may be reached at 801-224-1900 to schedule an appointment for an estate planning review.
This article should not be construed as tax or legal advice from Bank of American Fork. Please seek tax or legal advice from a qualified tax professional or attorney.