Five Things to Do When Death is at Hand

Of the things we’d rather not think about, death certainly tops the list. But whether you see the end of life in spiritual, practical, or philosophical terms, it’s something we all must confront eventually. In the words of one living will, “Death is as much a reality as birth, growth, maturity, and old age—it is the one certainty.”

The unpleasantness of the topic can make planning for death easy to put off. In fact, the vast majority of Americans will leave this earth without ever having prepared a will. But when the reality of death is fast approaching, perhaps through a serious illness, we should seize the opportunity to prepare for what lies ahead.

Here are five things to consider doing:

1) Update your estate plan. Having a current will ensures that the assets you leave behind go to the people or organizations you care about most. If you want to provide for a young person or someone with special needs, you will can set up a trust so their inheritance is managed for them.

A will also enables you to appoint someone you trust to settle your estate and divide up your household items and other personal property. Guardians can be appointed for any minor children, and you can even say who should take care of your pets.

An estate plan also includes a durable power of attorney and advance directive for health care. These documents allow you to designate someone to manage your finances and health care if you become unable to.

If you already have these documents, make sure they are still current. In some cases, out-of-date documents can be worse than no documents at all. An estate-planning attorney can review your paperwork and suggest possible revisions.

2) Inventory your digital assets. Your will and power of attorney should include provisions for your “digital assets.” Think online accounts, frequent-flyer miles, and passwords for your smartphone and other electronics. With proper planning, you can bequeath some of these assets under your will. You can also authorize someone to manage your social media and other online accounts during your final illness. Just be sure to prepare a list of your user names and passwords, so your designated agent can gain access.

3) Check the beneficiaries on your life insurance and retirement accounts. For most of us, the bulk of our wealth lies in assets that name a beneficiary, like life insurance and IRAs, 401(k)s, and other retirement accounts. These assets will transfer directly to the named beneficiary upon your death—regardless of what your will says. So make sure the beneficiary designations are up to date. Talk to a lawyer about directing these assets into a trust for a child or someone who doesn’t manage money well.

4) Consider making charitable donations. The estate-tax exemptions are currently $5 million in Maryland and $11.4 million at the federal level. This means that unless you leave behind more than these amounts, any bequests you make to charity probably won’t provide a tax savings. Rather than leaving charitable bequests under your will, consider donating to charities now, when these gifts may be deductible from your income taxes. Talk to your accountant or a tax attorney for guidance.

5) Prepare a statement of your final wishes. Leaving instructions as to your funeral and burial preferences can ensure that your farewell is meaningful to your loved ones and reflects your wishes and beliefs. Details can include hymns and readings for the memorial, instructions for the disposal of your remains, and even guidelines for announcements in the newspaper or online.

It is never too soon to take care of matters like these. When the need becomes urgent, your advance planning will help provide some peace and comfort for the road ahead.