by Laura Webb, Founder and President of Webb Investment Services, Inc.
I am in the business everyday of helping women plan for their future, but lately I have been spending time focusing on my own. A few things have shifted in my life. My mother passed away a year ago and I had spent much of my time focusing on her needs and her finances. I helped her get all of her assets and documents in order making the settling of her estate relatively easy, but I realized it had been over 7 years since I updated my own.
Seven years may not seem like a long time but think what might have happened in your own life. Children could have been born or left the nest, parents could have passed away, marriages could have begun or ended. The possibilities are endless. All those life events could impact your wishes if you were permanently disabled or left this earth, creating very good reasons to need an updated will and key estate documents. Even more important could be the position you leave your loved ones in if you have no estate documents.
Before we turn our attention to the necessary legal documents, let’s focus on the consequences if you die without a will. The legal term is dying “intestate” and the distribution of your assets and property is determined by the laws of the state you live in. Dying intestate can lead to outcomes you would never intend including letting the court decide who would be the legal guardian of your minor children.
What are some of the key considerations we, as women, should keep in mind when thinking about what estate documents are needed to accurately reflect our intentions.
- Asset Distribution – Determine how you want your assets to be distributed after your passing. Consider not only financial assets but also real estate, personal belongings, and any other possessions of value.
- Beneficiary Designations – Choose carefully the beneficiaries who will receive your assets. This includes named beneficiaries of your annuities, IRA’s, retirement plan assets as well as any life insurance. You can consider family members, friends or charitable organizations. Ensure the documents include their full names and relevant details to avoid confusion and ambiguity. You should check your beneficiary designations periodically. As life changes, your choices might change also. I once had a client who had been divorced for several years and when we reviewed her beneficiaries, she was horrified that her ex-husband was still the beneficiary of a $1 million life insurance policy. She changed that immediately.
- Guardianship of Minor Children – Any parent with minor children should give serious thought to who the guardian(s) of their loved ones should be. Choose someone you trust, who shares your values and who is willing AND capable of fulfilling the role. Discuss it with them.
- Executor Selection – The executor of your estate is the person who is responsible for carrying out the instructions in your will, managing your estate and handling any legal and financial matters. Select someone you trust who is agreeable and capable of fulfilling these duties. It is also a good idea to name an alternative executor in case the primary choice is unable or unwilling to serve.
- Power of Attorney – This is a legal document that grants someone the authority to act on your behalf under certain circumstances. There are three types or Powers of Attorney: General, Limited or Specific and Durable Power. Each designates the powers you are giving to your agent which is frequently known as the Attorney in Fact. This document was very helpful when my mother was not able to take care of her own affairs.
- Healthcare and End-of-Life Decisions – While your will addresses asset distribution, it is equally important to consider healthcare and end-of-life decisions. It is wise to create an advance healthcare directive or living will that outlines your wishes, such as the medical treatment you may or may not want, including issues of life support and potential organ donation.
- Digital and Online Presence – Realize the importance of managing your digital assets or online presence if we are incapacitated or pass away. It is smart to specify your wishes regarding the management or deletion of these assets in your will. A document listing your usernames, passwords, and instructions for accessing and managing your digital presence may also be useful.
It is easy to procrastinate. Most of us don’t think anything will happen. Depending on your age, the probability of becoming disabled or incapacitated for some time is statistically higher. A healthcare power of attorney or one of the other Powers of Attorney could be necessary to help take care of you and your family.
Regardless of your age or gender, having the basic estate documents are a MUST but there are a few unique concerns women should keep in mind. Women live longer which can have a significant impact on your financial lives. Living longer frequently requires more assets or other income streams in addition to social security. Women have typically earned less than their male peers, might have taken time out of their work life to care for others, which in turn could mean lower benefits from Social Security and less assets accumulated in retirement plans. It is essential for women to take an active role in managing their assets and finances. This includes understanding and documenting financial information such as bank accounts, investments, real estate, and insurance policies. Being informed and involved can make decisions about your estate plan, appropriate beneficiaries, power of attorney designations, and how your assets are distributed easier.
No one enjoys contemplating or discussing death or disability. Estate planning can potentially be complex and individualized. That is why it is recommended to consult with a qualified estate attorney or advisor who can guide you through the process, help you understand the specific laws and regulations in your state and tailor an estate plan that supports your unique needs and goals.
Articulating your wishes, developing a plan, creating the proper tools so your wishes are implemented and then communicating those wishes to your loved ones can make those difficult events less painful for those you leave behind.
Laura Webb is the founder and president of Webb Investment Services, Inc., based in Asheville, NC. She is a CFP® professional and the creator of the Her Two Cents podcasts, which focuses on helping women normalize the conversation around money. Her team focuses its efforts on helping women secure their financial futures. For the rest of the story, please visit the Webb Investment Services, Inc. website or email her at firstname.lastname@example.org.
Webb Investment Services, Inc is not a registered broker/dealer and is independent of Raymond James Financial Services, Inc. Securities offered through Raymond James Financial Services, Inc. member FINRA/SIPC. Investment Advisory Services offered through Raymond James Financial Services Advisors, Inc., 82 Patton Ave, Suite 610, Asheville, NC 28801. 828-252-5132.
Any opinions are those of Laura Webb and not necessarily those of Raymond James.