Top 5 Legacy Checks To Do At The Beginning Of Every Year

By Michael Babikian

I can’t help but get sentimental when another year comes to a close. I think about how much my kids have grown and how much has changed over the last 12 months. I also think about the legacy I plan to leave behind (but not for some time, I hope). Of course, I want to make sure my kids are financially secure, but I also want them to carry on our tradition of making my grandmother’s cookies during the holidays. I want them to remember all of our time and trips — the memories we’ve made together.

In order for this to happen, I have to make sure I’m organized. So, I created a list of five things I check at the beginning of every year to help ensure that my legacy still aligns with my life in its current state. I’m sharing it with you in hopes that it can do the same for you and your clients.

1. Check beneficiary designations.

Beneficiary designations are an important piece of your legacy. That’s because any account or policy that has a beneficiary on it is protected from probate. These assets go directly into the hands of whomever you designate. Check life insurance policies, brokerage accounts and 401(k)s to see if the primary and secondary beneficiaries are still who they should be. Did you know you can list beneficiaries on your checking and savings accounts as well? It’s called something different — a payable on death — but it bypasses probate just the same.

2. See if your will and trust need to be updated.

Maybe you’ve had another child or grandchild. Maybe you recently were married or divorced. All sorts of life events can affect your will and trust, and you want to think about your instructions for the disbursement of your belongings. Is there any reason you’d want to reallocate your assets or designate new trustees or beneficiaries?

3. Inventory assets – both financial and personal.

The first time you do this, it’s a daunting task. But keep in mind that you don’t have to get it done in one day. Start a list and when something comes to mind, make a note to include it and describe where it’s located. Be sure to include photo albums, family stories and traditions, and recipes.

In addition to your primary financial assets, you’ll also want to include anything you wrote or created, apps, money in your PayPal or Venmo account, Amazon movies, iTunes —digital assets that are easy to overlook. Once you’ve done the heavy lifting of creating an inventory of all your belongings, updating it each year is pretty painless.

4. Make sure account usernames and passwords are up to date.

Not only will this give your brain a break from remembering which password you used for which account, it will also help your family access your accounts if something happens to you. In absence of this guide, your family will need to work directly with each company, which is far more time-consuming — in some cases, company privacy policies will restrict access and lock out your next of kin.

5. Check durable power of attorney and health care proxy.

Many people designate their spouses as their power of attorney, health care proxy or both. It makes sense — you share your life with this person, and there’s inherent trust. However, should you get divorced, it becomes imperative that you immediately appoint a new POA and health care proxy. Even relatives fall out of favor with one another, so it’s important to make sure that the person who wields this authority is someone you trust now.

Michael Babikian is founder and CEO of LegacyShield. He may be contacted at [email protected].

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