Many parents find it uncomfortable to inform their children about personal matters. Yet informing them of your financial, estate and medical arrangements may help everyone prepare and plan for the future. The information that is shared need not include exact facts and figures, but it is wise to share the following information:
- Life Insurance. Since the purchase of life insurance is usually to provide funds to pay off debts, expenses, estate taxes or lost income, knowledge of the existence and location of such policies is critical. Be sure and make a list of any policies you have and where you keep them.
- Wills and Trusts. Since you prepared these documents to make sure your assets are distributed according to your wishes, you should make sure, first, that they are updated to reflect your currents wishes, and second that your children and/or executors or trustees know where you keep them. You may not wish to share the provisions of your will or trust with your children, but certainly your family should know whom you have chosen as your executor or trustee.
- Health Care Documents. If you have taken the time and forethought to sign a Living Will and Health Care Power of Attorney, you should inform your children and/or your agents that you have chosen them and what exactly your wishes are. This is particularly important regarding your Living Will, which specifies your preferences regarding administering or withholding life-sustaining medical treatment. I would suggest that you give copies of these documents to your children and agents when you discuss your wishes with them.
- Durable Power of Attorney. This document names the person or persons you wish to handle your financial affairs should you become unable to do that yourself. This may be a very broad grant of authority, or it may be limited to certain accounts or transactions, depending on your wishes. Your agents should know where you keep this document. Also, remember that the power of attorney automatically terminates upon your death.
- List of Assets and Debts. Put together a list of your assets and debts and inform your children that you have done so, and where you keep that list. It is not necessary that you show them the list, if you are not comfortable doing so. This list should also be updated on a regular basis, and will be invaluable to your children upon your disability or death in making sure your affairs are handled properly at that time.
Although your privacy is certainly important, letting your children know that you have thoughtfully planned for these inevitable events is important not only for your own feeling of well-being, but also for your children’s knowledge that your planning can and will be implemented properly and according to your wishes.