This is the typically the slow season of the year for personal finances — a perfect time to get things in order. I firmly believe that if you leave financial projects undone, you are tempting fate. Here’s my starter to-do list.
It will give you the latest info from the IRS about your tax return status — since you can’t speak to an agent. Like all things, the IRS doesn’t make it easy.
On the homepage at www.IRS.gov, you’ll find a “sign in to my account “ button. If you don’t already have an account, go there anyway, then scroll down past the “reset your password” button to the small print at the bottom of the page that says “create an account.” After that, it’s easy to proceed.
And, for that matter, check your very old pension funds that you left behind. Strange things are happening. A recent column of mine went into details, but this bears repeating.
If you forget an old retirement account, pension plan or life insurance policy, your ex-spouse could get it all!
You don’t need a lawyer to change beneficiaries. Most retirement plans allow you to make changes online. But if you’re not naming your spouse as beneficiary of your 401(k)or pension plan, be sure to ask the custodian for a spousal waiver form.
You can do it for free at AnnualCreditReport.com. You don’t have to sign up for costly protective services. But read your report carefully.
You’re looking for an unrecognized account — or inquiries from a bank or credit provider. That could be a sign that someone established an identity using your credit information and Social Security number and then opened a bank account to receive unemployment benefits by direct deposit. You wouldn’t know if they had, because they gave a different address or had documents sent to their email.
And while you’re at it, freeze your credit. You can always unfreeze it with a PIN. Once your credit is frozen, no one can use your ID to open new credit.
What if you got hit by the proverbial bus today or died suddenly as a result of a terrible accident. What if you went into a coma?
Who would know how to deal with all of your stuff — and be empowered to do so??
Where are your accounts? Even worse, what are your passwords? Have you given someone you trust access to this list or your password vault in case you are unable to act for yourself.
Have you made a list of important documents: bank safe deposit box and key location; location of cemetery deed; prepaid funeral plan; military separation papers.
Start gathering this information using the Personal Financial Organizer form at TerrySavage.com. You can print out as many copies as you want — and give blank forms to friends and family.
Do you have a will? If so, when did you last revisit and revise it? You’re not immortal, you know.
An estate plan is not about saving estate taxes! Estate taxes don’t kick in until you leave at least $12 million to your heirs. A plan is about making sure your wishes to distribute your assets are followed, whether they are investments or family heirlooms.
NOTE: If you’re creating a revocable living trust, be sure to change title to assets like your home and accounts that are outside your IRA into the name of the trust — an easy process.
This is not a do-it-yourself project. If you make a mistake, you won’t be around to fix it by the time it’s discovered! Find an estate planning attorney by contacting your bank or using the search at findlaw.com.
And while you’re at it, make out a healthcare power of attorney, and give your physician a copy, along with your living will — the document that describes your wishes around end-of-life treatments.
Yes, I’m talking to you! If your spouse or elderly parent won’t discuss these issues, use the organizer form to initiate a discussion. It may be aggravating now, but it will save a lot of grief later. And that’s The Savage Truth.
Terry Savage is a registered investment adviser and the author of four best-selling books, including “The Savage Truth on Money.”
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