If you were to suddenly die, would those who are left behind know what to do next? If not, you might want to consider creating a Life Insurance Family Survivor Guide for your loved ones. In Part 1 of this informative two-part article, we’ll talk about how to do just that.
There’s an old expression: “It’s better to be safe than sorry.” Like knowing to wear a parachute if you plan to go skydiving. Or insuring your home against the threat of fire. Or having life insurance in place to protect your family. That’s where a Life Insurance Family Survivor Guide might come in handy.
Seriously, if you were to die tomorrow, would your loved ones be able to quickly access what they’ll need to take care of everything? If your answer is “no,” then this article might be helpful.
How to create a Life Insurance Family Survivor’s Guide
Knowing what to do, in advance, is a good idea. At the very least, once you have the information, you’ll be in a better position to determine where to keep this guide, and who you should be talking to about it…now.
For starters, ask yourself these questions:
- Do I have a will or trust?
- Have I named a power of attorney?
- Have I named a beneficiary for my bank accounts and retirement plans?
- Do I have my funeral expenses covered?
- If I own a business, do I have a succession plan in place?
- Do I have life insurance to replace my income for my family?
Asking these questions ahead of time can help you create an impactful Family Survivor’s Guide to help your loved ones move ahead after you’re gone, without fear of financial stress and worry.
What DOCUMENTS do I need?
A will is a commonly-used document that spells out exactly how you want your assets to be divvied up after you die. A will is often less expensive than a trust, but is typically subject to probate.
A trust is another commonly-used document that requires the appointment of a third party…or trustee…to take control of your assets on your behalf. Trusts can cost more, but the right kind of trust can help you avoid the expensive and time-consuming PROBATE court process. A trust can also help keep your financial affairs out of the public record.
A power of attorney document designates someone you trust to handle your financial affairs in the event you’re still alive, but no longer capable of making those decisions on your own.
Make sure that your money goes where you want it to by naming a primary and contingent beneficiary on all applicable bank accounts and retirements plans, such as 401(k) accounts, IRAs, and life insurance policies.
If you have life insurance you need to have instructions in place so your spouse knows how to make a claim and collect your policy’s death benefit without added headaches or hassle. In order to receive the policy’s death benefit, the survivors will need to file a death claim with the life insurance of record. At AccuQuote, we have put together a checklist to help you file a death claim in the most painless way possible. It might be a good idea to print this page and keep it with your life insurance policy and other important records.
Also, it might be a helpful to have a “sit-down” with your spouse and go over every item in your newly-created Family Survivor’s Guide. Make sure all the checklist items are clear and concise, and collect all the important documents and keep them in a safe and secure location.
In Part 2 of this article, we’ll talk about how to properly file a death claim.