1/6/2012 12:45 PM ET|
How to die the right way
These 8 steps can help ensure that your exit from this life goes as smoothly as possible for you and your family -- and that you get the send-off you want.
Excuse No. 1: You're not going to die.
Excuse No. 2: You've been too busy.
Excuse No. 3: You can't stand thinking about a future that doesn't include you.
If you're coming up with these or other reasons for not planning for death, you're in good -- if not smart -- company.
Just over one-third of Americans have a will, and fewer than half have any estate-planning documents at all, according to a 2011 survey conducted for EZLaw.com. "People don't want to think about dying. They're uncomfortable with the topic," says Danielle Mayoras, co-author with Andrew Mayoras of "Trial & Heirs: Famous Fortune Fights." "For that reason, they don't do anything about estate planning."
But making arrangements for your final days and beyond isn't just about helping your family through difficult times. It also lets you designate representatives to make decisions about your care, withdraw money from your accounts to pay your bills and celebrate your existence in exactly the way you want -- even if that means letting you take your last ride, to the cemetery, in a less-than-likely vehicle.
1. Write a will
If you die without a will, complete strangers will decide how to split up your estate and raise your children. It's called dying intestate, an act (or failure to act) that leaves the divvying-up process to state law. In lieu of a will, the court gives first dibs to a spouse and children, followed by other relatives. If you have no family, your property goes to the state. And unless you appoint a guardian for your minor children in a legally executed will, their future will be determined by the court.
Don't let those things happen. You can make out your own will for $70 or less at a do-it-yourself website, such as LegalZoom.com. If your circumstances are at all complex, you'll need a lawyer, who will charge about $300 to draw up a simple will and $1,000 to $3,000 for an estate plan that involves a will and a trust.
Be sure to update these documents periodically to account for major events, such as the birth of a child. If you don't, you could create the very mess you were trying to avoid.
2. Consider life insurance
You can skip life insurance if you have no one to support or you have enough money socked away to provide for your spouse or partner. Otherwise, you'll need enough coverage to meet your family's expenses when you can't.
To figure out how much life insurance you need, estimate what it would cost to pay off your debts, such as a mortgage and car loans, and to fund savings goals, such as college for your kids. With these needs accounted for, your family may be able to live comfortably on about half of your current pretax income. Multiply that annual amount by 20 to determine how much coverage you'll need. For example, it would take $1 million to produce $50,000 of annual income.
To calculate your total death-benefit needs, add up the amounts for paying off your debts, funding savings goals and providing annual income. But don't take that number as gospel, says Tim Maurer, a fee-only financial planner in Hunt Valley, Md. "It can be geared up or down, depending on your situation."
Term life insurance, which carries a fixed premium over the life of the term (usually 20 years), can be surprisingly affordable, even for large amounts. For instance, a 35-year-old male nonsmoker might pay $470 a year for a 20-year term policy carrying a $1 million death benefit.
3. Establish critical end-of-life documents
"A lot of people think that estate planning is only for when they die," says Danielle Mayoras. "It's also to take care of us during our lifetimes." To help family members carry out your wishes if you cannot, provide them with these documents:
- A durable power of attorney lets your agent manage your finances and legal affairs.
- A release-of-information form gives doctors permission to share your medical records with designated representatives.
- Advance directives provides guidance when you are alive but incapacitated. A durable power of attorney for health care names a representative to make medical decisions on your behalf. A living will specifies the medical treatment you do or do not want at the end of your life.
VIDEO ON MSN MONEY
Advise: Don't leave anything behind. Will or no will. "Happy" family or "Dysfunctional" family. Will or No Will. People turn into a pack of ravenous wolves when a "loved one" dies. I owe nothing to my children, I raised them and helped them get their starts in college and/or business. My wife and I are preparing a moderate to good retirement. The first one "to go" leaves everything to the partner and it becomes her's or his problem to get rid of the rest before she/he dies.
One adult child called us when we were out shopping and wanted to know where we were. We told him we were out spending his inheritance.
I'd rather that my corpse be thrown in a hole which was just dug in my backyard.
If making profit off of somebody's death isn't disgusting, I don't know what is.
I have been retired for several years now and in reading the the attached "comments" I am reminded of why I retired.
Let me be perfectly clear, America is still a land of LAWS. You either know the law, or you don't. You are responsible for your situation, what ever it is. Nobody is going to knock on your door and tell you what you should do with your "stuff." Law's change daily so don't listen to the "know-it-all" big-mouthed brother-in-law who wants to tell you what you should do or not do! (Did you ever notice how these know-it-all types never seem to have anything? ) There are still one or two lawyers out there who are knowledgeable and ethical and will help you. Yes, you will have to pay for competent advise. No, don't think just because a lawyer is the most expensive in town that he is the "best" for you. Ask friends for referrals, etc. Do some homework!
Funeral homes offer a wonderful service for the price. Yes, it seems expensive, but consider that that lovely setting our families gather to morn, represents an investment of a couple million dollars. Many are passed down for generations and are contributing members of the community.
Thank you again.
Really Lawrence grossman....another reason America is in the mess we are in. Lawrence
who do you think is paying for your free ride......the tide is turning.....I hope you have a back up plan.....Dumb A.
To Someone(Frugal Francine)
Grossman may have some worrisome ideas BUT anyone on social security isn`t taking the government for a ride. In my personal case, the government has used my one point five million dollars of social security taxes that I have payed for more than fifty years. I have a right to receive some of that money for a meagher ten to even twenty years of 1,ooo$ a month, which would come to about a third of what I have put into. Who is screwing who when he talks about the government??????
My husband keeps putting me off from getting a will done. He thinks that we will both live to an old age and have plenty of time to get this done. Only he has income from his own LLC company, which I would not be able to run in the event of his death; he has some debt but no life insurance to cover it. Fortunately our home is paid for and we have no personal debt.
We don't have any children, but we have never discussed if we should leave assets to relatives or our favorite charities. We have dogs with no provision for them to be taken care of.
They only thing I've done is verbally directed my husband that he have a green funeral for me, and I've selected organ donor on my driver's license in the event of a fatal car accident.
This is sad because we are educated but lack the will (pun intended) to get things done for our eventual deaths.
The other thing, STAY OUT OF DEBT! My parents had big credit card debt and it was a horrible and heartbreaking task to send of death certificates like that.
As for how to divide up an estate, that too is something that should be discussed prior to death so all are on the same page. This can alleviate a tremendous amount of family conflict and the last thing a grieving person needs is conflict.
Wills minimize Probate, Trusts minimize Taxes. Even estates with a will go through Probate, but it is nearly a rubber stamp approval rather than a protracted series of expensive hearings.
There are instances where dying intestate is a benefit to your intended heirs. My former Brother-In-Law died last year with no will. With no spouse and two adult children our state's Estate Laws mandated his estate be split 50/50 between his two daughters - his wishes. With no Will his worthless POS brother and gold-digging sister could not fight the property disposal decision! If he had left a will they almost certainly would have tried to fight it in court.
I do not recommend dying intestate but there are rare circumstances where it will be a benefit to your heirs if no Will exists.
Seriously? A $1 million policy for someone who makes $50,000 a year? Was this written by an insurance salesman?
Don't be worth way more dead than alive. It'll kill your sense of self-worth.
And don't worry about a will if you are married. If you don't trust your spouse to take care of your stuff when you leave this world, then you shouldn't be married to that person.
Oh Darn, no one gets out alive. I want to put some roof racks on my casket.
Please do not listen to Mister Manners, who says if you are married, you do not need a will. In some states, a spouse may not receive all of your assets if you don't have a will. For example, in New York the spouse gets the first $50,000, but then the spouse and children split the rest 50/50. If this is not what you want, you need a will. Don't assume that your spouse will get everything.
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