 SECURE YOUR FINANCIAL FUTURE! INVEST IN YOU!
Welcome back to Money 101, Invest in You: Ready. Set. Grow's eight-week guide to financial wellness.
You are almost there! Today is our eighth and final challenge, focusing on preparing for any unexpected illnesses and your eventual death. To that end, there are four essential documents you must have, which we'll go over for you.
Many people don't like to think about "what if" when it comes to their money because they are often too busy thinking about the here and now.
Yet, if you aren't prepared, your financial life could turn upside down because of an unanticipated event. Or, decisions about your estate or your heirs could be made by a complete stranger.
A shocking health scare showed me first-hand the importance of preparing for life's dramatic turns. In the fall of 2016, I spent a month in hospitals recovering from emergency brain surgery. The four documents we'll outline in today's lesson were essential in identifying who would make some very critical decisions for me. Having the right people and paperwork in place helped save my financial life.
Thanks again for joining me on this journey — and happy learning!
Sharon
CHALLENGE #8: PREPARING FOR THE WORST
Four essential documents A will A last will and testament spells out whom you want to give your assets to after you die. If you have minor children, it also allows you to name a guardian to care for them.
In your will, you also name an executor, who is tasked with making sure your wishes are granted.
A durable power of attorney If you are sick and unable to do things like pay your mortgage, rent and other bills, a durable power of attorney enables you to assign someone to make financial decisions for you.
This can be a spouse or another family member or a friend. You can also name a backup in case your first choice is unable or unavailable to fill the role.
A health-care power of attorney This designates someone to handle your medical decisions if you become sick and can't make them for yourself — from the emergency room to ongoing hospital care, rehabilitation and outpatient visits. It is also called a health-care proxy.
A living will This is not to be confused with a last will and testament.
A living will, called an "advanced directive" for medical decisions in some states, is a written document that lets you express your wishes for medical treatments you would or would not want to be used to keep you alive, including resuscitation and intubation.
Your health-care proxy must abide by what you have spelled out in your living will.
Find an attorney You can go online to find the forms to create these documents on your own. However, I prefer working with an expert — an estate planning attorney — because if the documents are challenged, you want to make sure you have an attorney who is in your corner.
The best way to find an attorney is to ask family, friends, colleagues or your financial advisor.
Then interview a few to get quotes on their fees so you know what you're paying up front.
"It's better to look ahead and prepare than to look back and regret."―Jackie Joyner-Kersee
Make lists While a will is necessary to let everyone know your final wishes, it's also important to make sure your family members know where to find your important financial information. Make a list of what they need to know, including where to find your will, bank account information and passwords to your accounts. Don't forget to also include the name and contact information for your lawyer, as well as your Social Security number and information on your retirement and other investment accounts.
The bottom line Congratulations! You made it through our eight-week challenge.
I hope you learned a lot about managing, growing and protecting your money. Remember, it's an ongoing journey to protect your financial life. Whenever you feel the need, go back to any of these challenges to refresh your memory or help you get back on track.
And as always, Invest in You! Best of luck!
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