It might be hard to think about, but if something happened to you, having your financial affairs in order will make a difficult time a little easier on your family.
You need to ensure that your documents are stored in a secure place that your loved ones can find. They need to know what assets you have, what insurance policies are in place and how to access your superannuation or life insurance.
Check bank accounts and other assets
Can your bank accounts be accessed by your partner when you die? Check with your bank if you are unsure, as they may only be able to access joint accounts.
If accounts are in your name only, how would your family access the funds? Do you need to set up an emergency fund to cover things like funeral expenses, a fund that more than one person can access?
Review your assets and work out which ones will be passed directly to beneficiaries and which ones will have to go through your estate.
For example, if you own a property with a partner as joint tenants, the property will automatically transfer to your partner in the event of your death. However, the same property owned solely by you will become an estate asset and will need to be dealt with in your will.
Involve your partner
If your partner is not involved with your finances, try to get them involved. Introduce them to your accountant, financial adviser, lawyer, or any other professional you use to help manage your affairs.
If you don't do so already, consider taking your partner to any face-to-face meetings so that they will become familiar with the person and where they are located.
If something unexpected were to happen to you, your partner should at least have a basic idea of what assets and liabilities you have and who helps you manage them.
If you are managing your own affairs, consider leaving detailed instructions on how to access joint assets such as bank and investment accounts in a secure place. Do not store passwords with login details.
Write or update your will
Having a valid will ensures your assets go to the people you want to have them. You might also consider granting someone you trust an enduring power of attorney to manage your affairs should you lose mental capacity.
It's a good idea to review your will and powers of attorney on a regular basis or whenever your circumstances change. Be aware of events that may invalidate your will, for example, a new marriage will void your will but divorce will not.
Keep important documents safe
To make sure the person managing your estate can easily locate all of your financial information, set up a file listing all your assets, liabilities, insurance policies and other financial information.
The file should include all relevant details such as:
- the financial institution, account number, name of the account
- policy provider, policy number, date account opened or policy commenced
- any other information that may be required to accurately identify you or your account.
You should also include the latest account statement for these documents in the file. Don't forget to include financial products where you receive correspondence by email.
Consider keeping a hard copy and an electronic copy of this file. Keep the electronic copy in a secure data file and the hard copy in a locked filing cabinet that only the person managing your estate has access to. Do not include passwords or other access details that only you should know.
Are you eligible for an Age Pension? Do you know your rights? RetirePlanner™ tool has all the information you need.
For more ideas on keeping your financial affairs in order, visit moneysmart.gov.au
Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.
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