News & Articles

Spring Cleaning

May 01, 2007

by R. Patricia Grenier, CFP®, CSA

Finally tax season is behind us.  We can look forward to sunshine and warmer days.  This is a good time to review and "clean up" you financial documents.  It is a task we hate because it forces us to confront our mortality.  Having just lost a close family member at the young age of 45, I know from first hand experience how devastating that loss is on the whole family.  The situation also drove home the importance of having the proper, updated financial documents in place.

All individuals and especially those with young children need at minimum, three documents:  a Will, a Durable Power of Attorney, and a Health Care Proxy.  The contents of these should be discussed with loved ones and they should be updated periodically to reflect life changes.

We as financial planners can help you plan for a good quality life, provide sufficient income for retirement, plan for your children's education and fulfill your living hopes and dreams.  Financial planning does not end there.  It extends to the next generation.  The planning discussion should address such questions as:

• How are your assets going to transfer to your heirs or the next generations?
  
• Who is going to inherit your assets?  Are they capable of managing those assets?  If not, who is willing, able and competent to handle that responsibility.  Many times the person(s) who is willing and able may not possess the necessary skills to manage your assets or affairs.
  
• Do your heirs need guardians?  Again, who will that be?  Personally, selecting those people was the most difficult decision my husband and I had to make.
  
• What about estate taxes?  Does your current plan transfer assets in the most tax efficient manner given your personal circumstances and current laws?
  
• What if you die prematurely?  (My family member was only 45.  Yes, it could happen to you.)  Do you have enough liquid assets to protect your family's lifestyle?  What is enough for you and how can you fill in the gap?
  
• Disability sometimes is worse than death.  How will your family meet its financial obligations including educating your children if their primary source of support is unable to provide the necessary cash flow?
  
• If you suffer a disability, how will your business sustain itself?
  
• In the event you are incapacitated, who has the authority to step into your shoes to sign legal documents, negotiate transactions, interact with your bank, etc??
  
• If you have a Durable Power of Attorney, is the language such that it is clear, concise and specific so that the holder is able to step into your shoes without hindrances?
  
• What about a Health Care Proxy?  Is it up to date?  Have you discussed with your loved ones your wishes?  In the same vain, have you discussed your end of life wishes?
  
• Let's not forget your will and/or trusts.  Are they up to date?  Has you life changed since the last time you had it written so that it necessitates a change.
  
• Are your assets titled properly so that your trust is funded?  If not, why have a trust?
  
• Have you reviewed your beneficiary designation so the money or assets go to whom you want it to and in the manner you want.
  
• Is your trust set up properly to handle retirement assets?

Some information seems trivial but is extremely important.  From my family's experience, I know the information we needed that made our job easier.  Answers to such questions as:  Where are the important documents kept?  What is the password for the computer?  Where are the credit cards and how many are there?  What about contracts in existence such as Orthodontic Agreements or School Enrollment Forms, etc?  What about the pets?  So many things you may take for granted and then all of a sudden someone else needs to know and access.  Why not make it easier by talking to your loved ones and putting it in writing.

A comprehensive plan needs collaboration with professionals to provide solutions appropriate to you.  Please consult with your advisors - consider us you "Board of Director" and allow us a chance to meet, discuss and plan your benefit.

Pat Grenier is a General Partner with BRP/Grenier Financial Services in Springfield, MA. Securities offered through Cadaret, Grant and Co., Inc., Member FINRA/SIPC. BRP/Grenier and Cadaret, Grant and Co., Inc. are separate entities.

Pat can be contacted by phone at (413) 736-6712, or email her at pat@brpgrenier.com

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