It’s a fact of life that we’re all going to die at some point. We won’t know how or when we will die. There were an estimated 40,100 motor vehicle deaths last year. Only a 1 percent drop from the prior year. (source)
Whether young or old, with a lot or little to leave behind, there are things you can do now to make it easier on your family in case you die or are too ill or injured to speak for yourself.
Follow these steps to financially prepare:
Create a will
It’s a must for parents of minors. You will need to name a guardian for your children. Without a will, the state will decide. Setting up a trust for your kids is also important because children can’t directly inherit money or property until they’re adults. If you set up a trust, it will hold property and money for your children, and documents how the assets should be managed and used. If both parents die and there is no trust, the court will appoint someone to manage the assets.
You need life insurance if your death would be a financial blow to someone. Most parents need coverage to replace income or pay for services they provide for the family. Such insurance companies like Jenny Life Insurance, believe whether you’re already pregnant, or hoping to be, believe you should get insurance as soon as possible. You also need life insurance if you have debts that would fall on someone else.
Save for a funeral
Funeral costs are probably what first comes to mind when thinking of your family. People don’t realize just how much it costs. Set money aside in a savings account and naming a “payable on death” beneficiary — someone you trust to carry out the funeral arrangements.
You can always take care of funeral costs with a small whole life insurance policy or prepay for a funeral.
Keep organized records
Store important documents in a safe at home or safe deposit box. Make sure your trusted loved ones know where to find everything and have access to it.
You can also use online services to store documents and information digitally to share securely.
Put aside money for future expenses
Aside from losing a loved one, being stuck with debt, or left with no money can be just as stressful. Consider setting up a plan to pay off mortgage sooner, or setting up a college fund for your 5-year-old (A four-year student entering a public college will pay an average of $34,788 in 2020 per year. (source)) can help take off some of the stress of dealing with death.
I know this stuff can be uncomfortable, but once it’s done, it’s done. You owe yourself and your family that peace of mind.