Things You Should Know About – Keep Important Financial Information Updated
Keep important financial information updated! If you are an adult, you have certain responsibilities to your family and yourself. On the road to becoming an adult, you may not know these things and/or what steps to take to be certain that it is all kept updated. Nobody’s perfect; people make mistakes and often they are with finances. If you miscalculate with your financial future you can hurt the ones you love the most as well as cost them and yourself a great deal of money. You need to plan for unforeseen problems and for emergencies and you definitely need to keep financial papers and information updated and filed where your family members can have instant access to them if necessary.
Ways to Keep important financial information updated
Safe Deposit Box: It is an easy thing to go to the bank and rent a safe deposit box but that is not all there is to it. Before renting your box, check the rules at the bank where you are doing it. A safe deposit box is an excellent place to store stock certificates, insurance papers, jewelry, important papers such as adoption papers and marriage licenses, deeds, or anything else that screams “I am screwed if I lose this!” You should not put anything in the box that you might need access to immediately in an emergency. This includes passports, medical power of attorney, legal power of attorney, funeral instructions, and burial information. You should give the originals of the papers to your lawyer and you should store copies and your passports in a fireproof safe in your home or office for easy access.
Do not put your will in the safe deposit box. Let your attorney retain the original copy of your will. You can keep a copy with the other papers in your fireproof home safe. Putting this item in your safe deposit box can prevent you from having access at once if there is a death.
You may be surprised to know that access to a safe deposit box is restricted to the signatory(ies). A Power of Attorney does not automatically grant access. Law enforcement can gain access to your box if there is “cause” (such as belief that it holds something illegal). The contents of your box can also be frozen by court order or by the IRS.
It is important to always update your beneficiaries with wills, financial papers and insurance papers. Do not forget and let a former spouse inherit at your death instead of your current one. Update these papers when someone is added to your family through marriage or by birth (such as a grandchild), also. You should update your retirement account(s) to reflect any changes in marital status and be certain that all legal papers have the same information so there will not be any post death disputes.
Be certain that you are not “under insured”. Check with your insurance agent to see that you have the correct coverage on your home and family. Don’t try to save money by insuring your house for less than it would cost to replace it in a disaster. Ask about an umbrella policy which will protect your family if you are sued. Check your life insurance values.
Are you insured well enough that your family would not have to struggle if something unexpected happens to you?
Check your credit reports yearly to make certain there are no errors. This is also a way to discover identity theft. If there are credit cards or other accounts you do not recognize, you should contact the reporting company.
Leave information in an easily accessible place (in case of emergency) with your passwords and information about where important papers are. Include the name of your lawyer, keys to safe deposit boxes, a list of bank accounts and stock accounts. Family members should know information about your business, also.
Have an emergency fund. You don’t have to put away much each payday but you should try to save a nominal amount with regularity. Consider it a “debt” and pay your emergency fund first. Financial wizards say you should have enough savings to cover at least three months living expenses in case you die or are incapacitated. You can also purchase insurance that will pay your expenses in case of disability.
Pay your credit cards off each month. If you let a balance run and pay only the minimum amount each month, it could take you as much as 2 years to pay off a balance of only $2,000. You need to find cards with the lowest possible interest rate. Sometimes you can do a balance transfer at zero % for a period up to a year and ½. In order to pay off your debt, pay more than the minimum each month on each account. Make your payments on time. Late payment fees can mount up and eventually cost you thousands of additional dollars.
Never loan money to a friend or even a family member without having a legal agreement between you. This is the only way to insure that there won’t be any problems with collection.
There is more than one type of divorce. A collaborative divorce is one in which you do not go to court. A Litigated divorce is one which goes through court proceedings. A collaborative divorce has representation for each adult, a mental health person for the children, all parties agree on the properties of the agreement. It costs about 1/3 the amount of a litigated divorce which involves going to court and “fighting” to obtain an agreement. Many times, the agreement is imposed by the judge in the proceedings.
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