No one wants to think about end-of-life planning, but not being prepared can be damaging both for yourself and your loved ones—mentally, emotionally, and financially. On the financial front, we all plan and budget for big, life moments: college, a new job, buying a car or house, a wedding, having a baby and retirement, among them. So, why not also include end-of-life planning on that list, as your last moments are just as momentous as all of those other milestones in your life?
- Life Insurance: Know what your life insurance policy provides for you and your family. Consider the death benefit available and explore what financial obligations you may have near the end of your life, including medical bills and long-term care. If you may need financial assistance upfront, you can consider a Life Credit Living Benefit Loan to borrow against your policy and get immediate financial help—that can be paid back through your policy after your death.
- Will: This is an essential component of end-of-life planning. A will is a binding legal document that outlines details like how your assets will be distributed and, if you have minor children, who will serve as a guardian. Without a will, those decisions won’t be in your control.
- Beneficiaries: From life insurance to 401(k) plans, it’s critical to name beneficiaries so that your financial products can be properly distributed to those you select. Ensure that any joint accounts, such as a savings account with a spouse, are set to have a right of survivorship. This will allow your spouse or other loved one to inherit the funds without red tape like probate—which can be both costly and timely.
- Living Trust: Depending on the state in which you live, you might want to add the creation of a living trust to your end-of-life planning checklist. This is like a will, but is active while you are still alive, allowing you to take a primary role in the distribution of your assets. A living trust can be an essential financial strategy if you have special circumstances, such as if you are planning to leave a portion of your assets to charity or are setting up long-term care for a disabled loved one.
End-of-life planning is an unpleasant, yet necessary, component of your financial life. By ensuring all of the I’s are dotted and T’s are crossed, you can trust that all of your hard work to save and provide for your family will pay off in the long run.
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