Imagine for a moment you are on your way home from the store, and a dog jumps out in front of you. In a moment of surprise and quick reaction, you do your best to avoid the dog; however, you lose control of your vehicle and hit a tree. Thankfully, you survived the crash, but it requires an ambulance ride, a trip to the hospital, and a long recovery ahead. In a matter of a moment, your life has just changed. Fortunately, you didn’t die today. Very few of us die unexpectedly; most of us fade away over the years. This sobering reality raises some serious questions. What will happen if you are no longer the right person to make critical decisions regarding your finances, your family, and your life? What critical elements should you have in place to limit mistakes if you do begin fading away or become incapacitated?
Typically, most people either think these unexpected things will never happen to them or avoid thinking about them altogether. As financial planners, however, we witness these unfortunate situations all too often. What should you consider if you find yourself dealing with these unfortunate circumstances? It would be best to plan for the expected challenges to better prepare for issues we hope never arise. Unfortunately, most people don’t plan and are forced to make in-the-moment decisions that could negatively impact their financial future.
At Financial Enhancement Group, one of our Five Critical Elements to planning is Risk Management and Life Happens. We have a designed process to help our families when an unusual life event arises – good, bad, or ugly. If you are not working with a fiduciary professional, you must define the person and process to assist you when you can no longer make decisions on your own. It is important to consider the following:
- Have the correct health care documents in place so that someone can make decisions for you if you cannot. Some standard documents include Power of Attorney, a Living Will, and Do Not Resuscitate. These documents will aid the person in making difficult decisions that you have already defined.
- Keep an updated record of your financials so the person helping you during this time can take over. Provide your designee with access to your financial obligations and assets. Consolidating accounts such as bank accounts, investment accounts, and IRA/ROTH IRAs is beneficial.
- Confirm that your beneficiaries are up-to-date, and we recommend reviewing them annually.
- Make sure your trust and will documents are easily accessible. Review them regularly to ensure they stay current with any changes in tax policy, estate tax laws, and changes in your life or that of your beneficiaries.
Keep a hard copy of the critical documents, and keep an electronic copy. Most importantly, develop a plan and convey your objectives to the people responsible for implementing your wishes. Keep them informed so they can act appropriately, rather than react in a state of emotional turmoil.
Financial Enhancement Group is an SEC Registered Investment Advisor. Securities offered through World Equity Group, Inc. Member FINRA/SIPC. Advisory services can be provided by Financial Enhancement Group (FEG) or World Equity Group. FEG and World Equity Group are separately owned and operated.