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Death of our spouse is unpredictable. Just knowing that life insurance exists is not enough, it’s better to discuss and plan your finances well ahead.
As parents, one of our most important jobs is to get our children ready for facing the world. This does not mean that we foist our aspirations on them. It means enabling them to live a strong and happy life independently. On this path, we hope and usually believe that have the support of our spouse, partner or other individuals.
But life is unpredictable.
I remember reading an emotional account of a woman whose husband passed away in an accident on his way to work. The husband was very meticulous about keeping records of his financials, passwords, and other important numbers but these were in a password protected document on his laptop. The wife, although well educated and working, did not know this password. The story went on to describe how helpless she felt and her journey to take control of her life as well as that of her kids. Not to mention the emotional trauma and instability the kids went through.
In 2015, at age 47, Dave Goldberg, husband of Facebook COO Sheryl Sandberg, died in a freak accident. In the media interviews, Sheryl openly shared her grief and how she was afraid that her kids would never be happy again.
Although a morbid topic to discuss, death is an aspect of life we cannot ignore. This is even more important for women as we tend to pause or sacrifice our careers after kids. In the process, we lose control over the important aspects of our lives like email passwords, bank account numbers, income tax return, and life insurance documents. In a digital and increasingly computerized world, this is akin to wiping your existence away. This reminds me of another ironic story of a man who could not prove to the world that he was alive because he had no documentation to prove his identity.
How prepared are you in the event of a crisis? Knowing that you have life and a medical insurance is not enough. More important is being able to access this information when you need it.
My husband and I have gone over the steps I need to take in the event of his death and vice versa (we have even talked about what will happen if we both die). I know what his email password is and where I need to look for other important information. We have discussed our finances and how much I need to earn to be able to provide a comfortable life for our children. Although I work part-time now, one of my goals is to use the remaining time to develop my career skills so that I am ready and qualified to apply for jobs.
If you haven’t discussed the above with your family, I suggest you put it at the top of your to-do list. If you are a husband or a father reading this, skip the cricket game and sit down with your significant other.
1. Life and medical insurance: How much is there? Who are the beneficiaries? Where is it and how do you get access to it?
2. Accounts and credit cards: Where are they held and how much do they have? What are the account numbers and online banking passwords? If you do not already have one, I strongly recommend a joint account where both of you can contribute regularly.
3. Pension and retirement funds: Do we have one? Where is it and how much money does it have? How do I access it?
4. Other assets: Fixed deposits, stocks and other investments.
5. Debts, bills, and payments: How much are we paying and to who? Is it possible to continue paying if one of us dies? If no, what needs to be done?
6. Important contact information: Create a list with names and numbers of people you will need to contact. Make sure both of you know how this document and can access it. Some of these people could be lawyers, doctors, insurance agents, and employers.
7. Power of attorney and will: This is important as eventuality both of you will die. Meet with your attorney and draft a will. Identify the kids’ legal guardian. Before you appoint them, discuss with them. They should be comfortable with, and capable of raising your kids. Tell them where they need to look for all the above information.
8. Who are the immediate family we can trust? Last but not the least this is extremely critical as you will get all kinds of advice from everyone around you. With emotions running raw, it is very easy to take the wrong decisions and trust the wrong people.
Once you know all the above, you need to know what the “Actual Steps” are. If you have appointed a legal guardian, discuss with him/her as well. Here, sit together and picture the scenario in your mind. There will be lots of formalities to perform, and you will be in a sleepless and dazed state.
In our case, I know that the first thing I need to do is look for a small place to live, which we own. If we already own a home, I will have to downsize to a smaller home. Doing this ensures that I am not draining our limited resources by paying huge mortgages. Also, I would be ensuring a safe and secure place for my kids. So, the first step for me is to get in touch with our realtor.
What are we doing right now towards this? We contributed money to an account meant solely for a home’s down payment. We have also identified a realtor whom we have worked with in the past and who we can trust in a crisis.
The next step is to use other savings we have identified to continue paying for school and child care while I look for a full-time job. What are we doing right now towards this? As I work part time, I am investing money in online courses, networking and developing important connections. These connections will prove valuable when I start my job search.
We cannot control or predict death, but we can control how we face it.
Go ahead. Live with courage.
Image Source – Unsplash
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