Q&A: End of Life Planning
Why is a financial planner beneficial to end of life planning?
Financial planners can help alleviate much of the stress and concern that inevitably comes with end of life planning. Setting up power of attorney, compiling lists of assets and liabilities, and determining who will inherit what part of your estate are all complex issues with which a financial planner can help. No one likes to think nor talk about the end of life, but addressing these issues sooner than later with a knowledgeable financial planner is a best practice.
What happens if the spouse of someone who passes away is already deceased?
In the case that the spouse is already deceased, there are particular steps to take:
When applicable, contact Social Security and pension administrators.
Contact insurance agencies, annuity companies, the tax preparer, and the estate planning attorney.
Request at least ten original copies of the death certificate.
Make sure there is sufficient cash in an account that will not be frozen once institutions receive the death certificate and process the estate transition. We highlight cash flow as a high priority since a frozen account can come as a rude awakening when the surviving spouse needs cash to cover expenses. A healthy dose of patience goes a long way here as unfortunately, every institution has its own sets of rules and forms.
Assuming you are the primary beneficiary–which is generally what we see in California–retitle IRA accounts to your name and be sure to name beneficiaries.
As applicable, retitle taxable brokerage accounts.
Be aware of step-ups in the cost basis for taxable accounts and properties. Obtain an appraisal for all real estate property.
If applicable, check to see if the required minimum distributions in retirement accounts were already taken for the year.
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