Are You Ready For Death? Financially Speaking.

According to Bankrate, 57% of Americans do not have a will, leaving their personal finance, guardianship of children, and many other end-of-life decisions in the hands of strangers (state judges.) The lynchpin of a solid estate plan is having a will, but Vanguard suggests you also need the following assembled to leave your loved ones in good shape following your death:

  • Your assets. The value of all your personal and financial property. The type of assets you own, including brokerage accounts, retirement accounts, real estate, and life insurance policies. How those assets are owned: jointly with your spouse or another individual, in your name only, or in your trust’s name. The type and amount of any debts and the names of the individuals or institutions to which they are owed.
  • Account numbers and locations.
  • Important records. The bills you typically pay each month, your Social Security number, your marriage certificate, and benefit information.

Many people plan to “get to these later”, but oftentimes the tasks end up neglected and uncompleted.

Remember that the care of your finances and your family can exceed your life, but only if you take action while living to make sure these basics are covered.

Planning for the unexpected: What your loved ones need to know [Vanguard]

(Photo: Getty)


Edit Your Comment

  1. blue_duck says:

    Depressing, but true..

  2. Corydon says:

    Unless you want to end up like Terri Schiavo, don’t forget things like living wills and medical powers of attorney.

  3. loganmo says:

    Is that picture what a decomposing member of the Blue Man group would look like?

  4. mac-phisto says:

    one tip i’ve learned along the way: if you really want a loved one to have something when you pass on, give it to them before you pass on.

    added bonus: you get to see them enjoy it.

  5. blue_duck says:

    I happen to match the skull in color…

  6. Cattivella says:

    Estate planning is super important and if you have a decent amount of assets (over $100k) a trust is a good idea, and an even better idea if you have assets over the death tax exemption (currently at $2mil, no limit in 2010, then back down to $1mil in 2011), which, in the case of a couple, can be broken down into separate trusts to better take advantage of the individual spouse’s death tax exemption – which is a short way of explaining some complicated shiz that needs to be personalized and tailored.

    Oh, and go to a reputable attorney to have this stuff done. You might save a grand going to a paralegal service, but it’s going to cost you (and your beneficiaries) way more later.

  7. Ein2015 says:

    More good stuff to read: []

  8. Gopher bond says:

    Are people that are massively in debt beating death? I’ve often thought about this, say I have the house and everything paid off and they’re not in my name but I’m not married, yet I live with someone and I find out I’m sick so I rack up $200K in credit card debt and then kick the bucket. If nothing is in my name and I’m not married, what happens? I don’t actually have any debt and my house is paid off but it’s not in my name, neither is any automobile (nothing worth anything anyway). I do have life insurance but what if I canceled that?

  9. theblackdog says:

    I’m a “single” (state doesn’t legally recognize my partner) guy with no kids, is it really worth creating a will if it would just default to my parents anyway?

  10. stanner says:

    @Corydon: Unless you want to end up like Terri Schiavo, don’t forget things like living wills and medical powers of attorney.

    Good point – right after her birthday, my 18 year old daughter fell ill with a debilitating illness. Even as her parent, I was no longer allowed to make any medical decisions (she was not coherent at the time). We fixed the medical power of attorney problem right away!

  11. Applekid ┬──┬ ノ( ゜-゜ノ) says:

    I just sort of planned to stall the Grim Reaper with a game of Chess and secretly draft my will under the table during his turns.

  12. MissPeacock says:

    My boyfriend’s grandmother passed away a few months ago without leaving a will. You would not believe what a hassle her surviving relatives have had in trying to settle her estate (selling land, personal items, etc). Problems are compounded by the fact that one of her children thinks he deserves more than everyone else, and is refusing to cooperate with the rest of the family. It’s turned into quite the family rift, and it all could have been avoided if the grandmother had just left a will.

  13. MissPeacock says:

    @MissPeacock: As an aside, my own grandmother has everyone’s names taped to the bottom of nearly all of her possessions, along with a notebook that details who gets what (this is in addition to her actual will). If one of us sees something we want in her house, we tell her to put our names on it (knowing that we’ll get it once she passes on), and unless someone else has already claimed it, she’ll happily put our names on things.

  14. blue_duck says:

    @Applekid: Be careful though, the Devil may hop in and also challenge you to a fiddle play off… Just make sure you can multi-task.

  15. dollywould says:

    Does anyone recommend for these things?

  16. mrgenius says:

    Most states allow for a “Transfer on Death” or TOD designation on non-retirement accounts (like brokerage or bank accounts). The advantage is that you simply name your beneficiaries and the percentage split.

    A bigger advantage is that it avoids probate altogether and is non-contestable by family members. A lot of people don’t realize that a will becomes public record and can be contested by just about anybody. The disposition of assets is also much faster because you don’t have to wait for the court clerk to assign the executor of the estate either, nor do the assets have to pass through an estate account first.

    So I’d recommend anyone who doens’t have the assets to justify a trust (anyone with more than $2mm definitely should have one) should consider looking into adding a TOD designation to their accounts. It’s free and is usually 2 or three pages long.

  17. savvy999 says:

    @testsicles: I’ve thought about that scenario too, and I have no real answer. My guess is that if you have no legal estate, creditors have no recourse.

    So, my guess is yes, you could rack up beaucoup loans/CC debt before you die (assume it’s to be given away) and they would have to write it off.

    Harder for me, since I’m married and cosigned on everything… would have to get divorced, off the mortgage, off the student loans, etc… not worth it.

  18. MercuryPDX says:

    @theblackdog: Only in an instance where they outlive you. :)

  19. Norcross says:

    As an investment officer for a trust company, I can’t stress enough how important these things are. Set it up, so if nothing else, you can avoid probate. Also, for those who are strange, you can set up trusts to have any number of constraints on them, so your junkie kids can’t blow the money on booze and hookers. After all, you can’t take it with you, but you can control it from the grave.

    @testsicles: when you die, all your assets enter probate, and the courts decide who gets paid, etc. There is usually a 180 creditor period, where anyone can make a claim that they owe you money. They prove it, they get paid. Whatever is left goes on to the heirs. If they could prove you didn’t own anything at all, you could potentially get away with it.

  20. Nytmare says:

    Something that concerned me when my father was incapacitated was how informal and insecure the hospital was. They handed his personal effects off to a friend of his just because he was the first person to visit. They never looked up his next of kin or called to notify us of his condition, I learned it all through the friend. When I arrived, they accepted my claim of power of attorney and let me make decisions without ever asking to see the legal paperwork. This was a major hospital, not some rinky-dink organization. The good news is that I got almost no hassle or bias from the staff during the ordeal, the downside being a general lack of guidance about what to do aside from the very meaningful instructions in his living will.

  21. MercuryPDX says:

    I saw a notebook in a mail order catalog that was specifically for your survivors. Of course, I can’t find it on Google now amongst the endless sea of Anime cartoon references (Death Note).

    It was black, hardcover, and was titled something like ‘What you need to know after I’m gone’.

  22. blue_duck says:

    @MercuryPDX: However morbid, it’s a really good idea.

  23. wordsmithy says:

    My 46-year-old husband died of cancer last year. Having a trust drawn up before his death has helped me organize finances and will, after I’m gone, save my kids a bundle in taxes.

    Another tip is to have the passwords for all the accounts (including utilities, cellphone etc.) written down in a safe place. I had to close a few accounts and reopen them because I didn’t know the passwords.

  24. Finine says:
  25. pixiegirl1 says:

    My dad used to sell both trusts and cremation packages, now he only sells cremation. It really creeped me out at first all the talk about death and what not but after a while I just got used to it. The thing that amazes me is how many people don’t want to talk about it because “its such a horrible thing to talk about”. It’s such a sensitive topic.

    I think the worse thing you could do is to do nothing and not talk about it, if I had kids I’d want to have everything set up in advance in case something happened. I’d want to make sure that they will be taken care of if they are still minors and if they are adults I’d want to make the decisions as to who gets what it will make things SO much easier on everyone involved. People really need to get there heads out of the sand, because everyone dies get over it and get this stuff in order before it happens.

  26. RandomHookup says:

    @theblackdog: Is that what you want? If it is fine, but wouldn’t you rather have your partner inherit at least some of it? More importantly, you should lay out who gets to make decisions about your death — funeral, etc. That doesn’t have to be in a will, but you should make those decisions now.

    And what if you outlive them?

  27. RandomHookup says:

    @pixiegirl1: It’s the one thing all of us knows will happen to each and every one of us.

  28. RandomHookup says:

    @stanner: Just curious, so who gets to make the decisions in that case? Seems you would pretty much qualify as next-of-kin unless you were divorced.

  29. @theblackdog:

    I do some estate planning for same-sex couples (which I assume is why the state doesn’t recognize your partnership) and: It depends. Do you WANT the estate to go to your parents? Then you don’t really need to do much. But if you’d like it to go to your partner, charity, etc., then, yes, you need one.

    More important for many same-sex couples is a health care power of attorney, so that your partner can make medical decisions for you.

    @mrgenius: “So I’d recommend anyone who doens’t have the assets to justify a trust (anyone with more than $2mm definitely should have one) should consider looking into adding a TOD designation to their accounts. It’s free and is usually 2 or three pages long.”

    It depends. POD or TOD accounts are appropriate in some situations, but not all. Wills allow quite a bit more flexibility than POD/TOD accounts, and of course when there are minors involved, a will is a must to name guardians.

    As an estate attorney, the single biggest thing I can recommend is that you TALK TO YOUR FAMILY about your end-of-life wishes. I do have plenty of clients who refuse on the grounds that, “I’ll be dead, what do I care if they fight about it?” Which if you don’t like your family, well, that’s fine, but discussing your wishes beforehand can save a lot of heartache — and lawsuits. (And I do sit down with relatives and help the testator have the discussion if necessary — some people find themselves unable to tell Son that Daughter will be the executor, or Wife’s Parents that Husband’s Parents will be the guardians of the kids, without backup.)

    If you are a parent with minor children, you basically need a will (to name guardians) that sets up a testamentary trust if and when it executes (to hold your assets in trust for the kids). I typically recommend that the physical and financial guardians be different people (orphaned children learn to play the sympathy card quickly in many cases, and many times the most appropriate person to care for the kids isn’t the best person with money), but you know your family best, and lord knows I’d have MY mom be both physical and financial guardian without a second thought.

    If you have an “average” estate, whether you need a trust is a difficult question, and it varies quite a bit by state and even by county. I don’t think you should EVER buy a trust from an attorney who tries to sell you A TRUST. See an attorney who does estate planning with a variety of vehicles who can help you choose the proper one for your situation. Trusts are in SOME CASES appropriate vehicles to save money, taxes, or time. But in many cases, they’re a cash cow for attorneys (or banks) and you would not BELIEVE the number of people who come to me demanding a trust because late night television attorneys with infomercials think they need one. (Some of these infomercials are also clearly selling tax fraud.) In almost all cases, they’re setting themselves up for years and years of management fees, complicated taxes, no tax savings at death (estate isn’t large enough to trigger estate tax), and — in my county — probate is fast enough that there’s little time savings to using a trust. (And probate here costs far less than you’d pay in management fees on the trust.) In Florida, OTOH, probate is often very slow, and a trust might be appropriate to “beat” probate in that case. (Many counties can tell you how long it takes, on average, to probate a will. It can vary a LOT.)

    I do often recommend older clients (who have good relationships with fiscally responsible and honorable children) have a joint account with whomever is their caretaker child, so that child can simply write checks for the utilities and things when the client is in the hospital. Joint accounts go to the joint holder upon death, so that can also be used to store the money to pay for the funeral. A POD/TOD account is also useful for funeral funds.

    Oh, and one last thing — funeral instructions and body disposal instructions DON’T GO IN THE WILL. Nobody reads the will until after you start to smell really, really, really bad. Funeral instructions (or prepaid funeral info) go in a letter that can go WITH the will, but there should also be a copy with whoever’s your responsible person.

  30. RandomHookup says:

    @Eyebrows McGee: I want you to draw up my will just so I can say “Eyebrows McGee is my attorney.”

    That and to see my will signed “Witnessed by Eyebrows McGee.”

  31. quail says:

    @wordsmithy: I was going to say the same thing. Having the passwords for every account you have is a life saver for those you leave behind. Have a copy of your login information, the web addresses, and the passwords for everything left with the will or the insurance papers.

    One other thing I don’t see mentioned here is to get your bank accounts set up so that your spouse can get into them with just a death certificate. Waiting on probate to start can cause financial hardships. I’m not certain what it’s called but each account I’ve ever had I mentioned this and out came a single piece of paper for me to sign when setting up the account. This isn’t necessary if you have a joint account.

  32. quail says:

    @MissPeacock: Even having a will does not insure that family squabbles won’t happen.

    The best advice I’ve ever heard is to start giving away your possessions in your later years to the people you want to have them.

  33. MercuryPDX says:

    @Finine: Not exactly, but it’s the same exact concept. :)

  34. Good article. Like many others, I’ve “been meaning to get around to” getting a living will set up.

    Thanks for the kick in the seat, Consumerist.

  35. the_wiggle says:

    @theblackdog: yes. if you & they are all dead, where will your kids go & who will take care of them? do you really want the State to decide?

    @quail: oh yes, having seen the temporary wacktarded behavior inspired when family dies, best advice.

    @quail: also see ahead of time amt/when/where the life insurance $$ will be accessible to your survivors. bills don’t give a damn that you’ll have the $$ to pay’m; they wants it NOW.

    @Eyebrows McGee: i have to ask, what if someone has NO responsible person they may count on to handle things?

    @MissPeacock: what a great idea :) time to get me a moleskine

    anyone have any idea what happens to the adult children of people who adamantly refuse to set up any legal docs, like POAs, Wills, etc? Are they liable for the dead parent’s estate handling & debts?

  36. Cattivella says:

    @the_wiggle: In regard to not having a responsible person, you can always appoint a corporate trustee. They’re generally pretty responsible and will stick to exactly what a trust tells them to, but they are also a bit slower and will charge the estate fees. In our estate plans we typically have a corporate trustee as a backstop in case all other trustee options are exhausted, but it’s rarely resorted to. People with very large estates will sometimes go for a corporate trustee right off the bat instead of giving a family member or friend such a huge responsibility.

  37. MorrisseyTheCat says:

    @Eyebrows McGee: I want to know what my husband and I can do to ensure that are pets are taken care of (not sent to a kill shelter). We have no kids, just a couple of far out of state (mosty old) relatives, and we have several well cared for cats and dogs. I am always paranoid we are going to be killed in some kind of crash with no one to look out for them. Is there anything we can do where our wishes for them would HAVE to be carried out? (Ohio)

  38. MorrisseyTheCat says:

    OUR pets…arghy…sorry this keyboard/screen is itty bitty

  39. forgottenpassword says:

    Yeah, I need to make a will. But I dont like the idea of paying a lawyer 100+ dollars to get it done & dont trust those do-it-yourself kits because I’ve heard they arent as ironclad/legal as they are claimed to be.

    I really dont have any property of importance…. just my life’s savings…and it is in an account that has a doumented beneficiary.

  40. Cattivella says:

    @MorrisseyTheCat: There are “pet trusts”. I recommend seeking out an estate planning attorney in your area. You should be able to find one that will give you a free initial discussion meeting and they would be able to best guide you towards your options based on what state you live in and what its probate laws are.

  41. Cattivella says:

    @forgottenpassword: That’s kind of your trade off. You either pay to get it done right the first time or your beneficiaries pay on the back end. It depends on how much you like them.

  42. stanner says:

    @RandomHookup: Just curious, so who gets to make the decisions in that case? Seems you would pretty much qualify as next-of-kin unless you were divorced.

    In general I’m not sure. In our case, my daughter was alive, but semi-conscious. I would be next of kin, so would have ended up with the power at some point, but the question caused a delay during the heat of the emergency – not something you really want to deal with if you can so easily avoid it.

    Basically, the doctors asked “do you have medical power of attorney”. Without thinking, I said “no” which was clearly not the right answer.

  43. anatak says:

    @testsicles: When you die, what you OWN has to stand good for what you OWE. You would hope that someone with no assets would not be able to access $200k in credit, but that depends on just how stupid those companies are being that year.

    What would happen is that your creditors would have to go after what ever they could or write it off. Keep in mind that “going after whatever they could” could mean collections trying to sucker your family into paying off your debts. Not legal, but not unheard of.

    In the end, what have you gained by doing this? I’m also not sure I’d want to have to explain these actions after death.

  44. @RandomHookup: LOL, that’s a value-added feature. ;)

    And to @RandomHookup again: Your state should have something called a Descent of Surrogacy statute (or something similar) that lists, in order, who is your medical decision-maker if you’re incapacitated.

    My husband does some of this kind of thing for local hospitals, and I’ve noticed it seems to vary by hospital whether they take you at your word (or your ID) that you’re the next-of-kin … or whether they have the hospital call my husband, who’s the guy who goes over to the court and has them do a quick surrogacy to cover their asses.

    There is also typically a state office called something like “State Office of the Surrogate” or whatever which is the person appointed when you’ve got no findable or willing family or friends. I’m a little fuzzy on how exactly it works, but my husband gets them appointed when the hospital has comatose prisoners with no findable family, or when a family issue gets super-contentious among the preferred surrogates.

    @the_wiggle: “i have to ask, what if someone has NO responsible person they may count on to handle things?”

    You can name your attorney your executor. Or your accountant. Or a bank. Or your ex-military hyper-detail-oriented Hank-Hill-esque neighbor.

    This is the person you always want, by the way: The person with that bit of Hank Hill in them who is SOOOOO painfully fair and so painfully honest and honorable that it would kill them to cheat … and everyone KNOWS that about them. That gives all the beneficiaries a lot more confidence in the process.

    @MorrisseyTheCat: “I want to know what my husband and I can do to ensure that are pets are taken care of (not sent to a kill shelter).”

    I don’t know Ohio’s specific laws, but some states now do have laws that allow special handling of pets (set trusts up for them, etc.) to recognize they’re more than property. In my state, we don’t have laws like that yet; what I typically recommend is a clause that leaves them 1) to a friend or relative who will take good care of them, along with a one-time bequest of a few thousand dollars to defray the cost; if the friend is unable then 2) to a foster-pet organization, a trusted vet, or similar (along with a bequest, as appropriate); then 3) to a no-kill shelter or “a good home” (with details) at the discretion of the executor.

    The sad truth is that you can’t FORCE anyone to do anything after your death, so your best option is to identify people or organizations that you feel are trustworthy and (in the case of pets) goodhearted.

    One problem that can arise with “pet trusts” is that sometimes people have REPLACED THE DEAD PET with a doppleganger to keep getting the $50/month for Fluffy’s maintenance! That’s why I generally prefer a one-time bequest and giving the pet to someone who already loves pets and will care for yours because they’re good people, not because there’s money in it.

    @Cattivella: “There are “pet trusts”.”

    Not in all states.

  45. @MorrisseyTheCat: I meant to add — your concern isn’t at all unusual. The number one thing that makes people to cry when we’re having our initial consultation is “What happens to my pets?”

    Some of this is because by the time people call me, they’ve generally worked themselves up to it and had a discussion with their spouse/family about “What happens to the kids?” but providing for the pets often comes as a shock that they didn’t think of, and it sets off the waterworks.

    The other thing, I think, is that you can explain death to kids and there will be a million people worried about the kids — but you CAN’T explain it to pets, and there’s always the worry, will people remember my pets in the midst of the tragedy?

    I have seen more grown men cry at the thought of their dogs being alone after they (the men) die than at anything else.

  46. MorrisseyTheCat says:

    Aww! ::::Thanks Eyebrows::::: :)

  47. akronharry says:

    Anyone know of a site (without popups) that you can to download a free will form? Looked at a couple of sites after reading this article and you have to jump through hoops and advertising!

  48. PirateFrankie says:

    I handle retirement accounts and trusts for a brokerage firm, so I see this sort of thing a lot. Trusts are great if they are set up properly with contingent trustees to take over if the primaries are unable or deceased. Get a good lawyer from a firm that specializes in your state.

    TOD forms are also good, but many firms can restrict your beneficiaries to close family and they may not take the step of contacting them when you die. Make sure you leave account information for all your bank and brokerage accounts somewhere. JTWROS accts will go to the surviving account holder. Check your state laws about JTIC and JTTEN accounts as they vary. Be wary of owning all your assets jointly with anyone, they can be attached to IRS levies or other legal proceedings.

    IRAs and pension plans allow you to designate beneficiaries and sometimes contingent beneficiaries as well. Don’t let anyone tell you you need TOD paperwork for them.

    Brokerage firms will not act on any instructions without a death certificate, notarized instructions, and possibly court docs naming a personal representative or executor.

    *This is not meant as investment or tax advice nor am I soliciting security orders*

  49. Cattivella says:

    @Eyebrows McGee: I know not all states, I was just saying that they do exist and that they should seek out counsel in their own state to get specifics on their options.

  50. @akronharry: The only “form” site I like is

    If you have kids, tho, you really need to do it through an attorney!

  51. @Cattivella: Sorry. :) I get very irritated by people demanding pet trusts from me when they’re not available in my state and then getting all up in my face like it’s my fault. I wish some of these morning shows would emphasize “in SOME states” a little more when they tout them!

  52. BytheSea says:

    But what do you do if you’re not a million years old with kids and responsibility and stuff? If you’re an over-18 independent student with not many assets and a lot of student loans, for example? Are my parents going to be stuck with my debts, or paying for an expensive funeral because I don’t have a retirement plan?

  53. @BytheSea: Generally your debts die when you do, unless someone else was a party to the debt (as in, their name’s on it too) or you’ve done something complicated or have guarantors or something.

    What happens first is that the debts are balanced against the assets of your estate, and your executor or administrator is responsible for going through and paying those off (in a particular order, if there’s more debt than asset). I think this is what causes confusion, since people usually say “the executor is responsible for paying the debts” and leave off “with the estate’s money.”

    Federal student loans at death are specifically covered here: [] . I don’t think your parents or your estate has to deal with them at all. Loans on which your parents cosigned or private student loans will be different.

    In theory your creditors could try to force your estate to sell off your personal property to satisfy your debts, but I’ve never seen that happen with a small estate, so your stuff will probably go to people who want a remembrance of you, as decided by your parents (if you have no will, they’ll end up administering your stuff).

    They WILL be stuck paying for your funeral and burial/disposal. Well, SOMEONE will be, and presumably your parents are not going to leave you in the morgue.

    While you probably do NOT need a will at this age (unless you have a lot of assets, a closely-held small business, or children), what you may want to acquire is a Health Care Power of Attorney and possibly a living will. In most states, if you are an unmarried adult with no children and living parents, your parents are your medical decision makers if you turn up unconscious at the hospital, but generally for full-grown adults, if there isn’t a spouse, the hospital gets a little antsy and may want to have the court approve the surrogate decision maker. So a Health Care Power of Attorney is a useful thing to have.

    Most states have a “statutory short form” (or called something similar) for Health Care PoAs and for living wills (and DNRs too, usually), which you can find online in the state’s laws. (Or by googling “statutory short form health care power of attorney STATE”.) You can complete the statutory short form yourself (I’d pull it into a word processor and clean up the formatting, but some states have nice-looking forms you can get at the courthouse or library. Mine, you copy/past from the statute and it’s ugly looking); you don’t need an attorney. You’ll need to get it witnessed and possibly notarized, which you can do at your local bank, or often in your HR department. There are usually very complete instructions to help you do it properly.

    My state’s POA law is here: []

    If you click on Powers of Attorney for Health Care and then scroll down until it begins screaming in all caps (Section 4-10), that’s the statutory short form for Illinois. (The all-caps parts are instructions; the standard text is the legal document.) But a quick google reveals that the helpful folks at the department of public health have made a prettier PDF version: []

    You’ll note in Illinois you don’t need a notary, and you only require one witness.