The Mom Crowd

Valentine’s Day is coming up this Saturday and what better way to show your family that you love them than with a will and a life insurance policy! Okay, your family may not feel completely comforted by the reminder that you won’t be on earth forever, but it is something that you should have in order. Even if you just create a “love folder” and put all the documents in one place this weekend would a huge accomplishment. I know I feel loved by my husband’s proactive care for our family in case of an emergency. Here is a re-posting of my original post, ’7 Ways to Show Your Family That You Them’ in time for Valentine’s Day. 

We all show our family that we love them in different ways. Another way that you can show your love for them is to show them that you care about them even after you are gone. The hard reality is that we are all going to leave this earth and we don’t know when. I have a friend whose husband unexpectedly passed when they were 27 years old and she had 3 month old twins to take care of. It doesn’t matter what stage of life you are in, you need to be prepared.

Each person makes their own decision how to prepare for the end from an emotional and spiritual aspect, but here are some practical steps to be prepared from a financial and administrative perspective.

1. Have a will.

Even if you don’t think you have a lot of assets, you need to have a will because you don’t want the State to dictate what happens to your property after you are gone. You have the opportunity now to take that responsibility. It will save your family a lot of time and grief knowing your wishes, because getting an estate in order after someone has passed can take a lot of time.  You may be surprised by how many possessions you own after completing a will.

It is good to discuss whom will care for your children if something should happen to both parents. It is certainly a hard decision and there are many factors to consider. I know one couple who does not tell anyone who the “godparents” are, because it isn’t a family member and they don’t want to hurt anyone’s feelings. This is one decision I DO NOT want left up to the State’s probate laws.

Myth: I have to go through a lawyer to get a will.
Fact: Right now you can download a state specific will from USLegalForms.com for $20. Then all you have to do is fill it out and have it notarized.

2. Have Term Life Insurance.

If someone depends on your income then it is best to take out a policy for 8 – 10 times your income. Then once the life insurance money has been issued, your family can invest the money in a good growth stock mutual fund and if it earns at least a 10% return, you can live off of the interest. Then the lost income is replaced.  Since I am a Stay at Home Mom, this gives me an enormous amount of peace knowing that I will be okay for money if something should happen to my husband.

For Stay at Home Moms a policy should be for about $250,000 to $400,000, because a mom’s work is valued at about $40,000 a year. (Although, it feels like it should be more!) The idea is that if something happens to the mother, then the father can afford a Nanny or Child Care while he continues to working.

Don’t assume you have life insurance through your work. Find out the details of any life insurance plan you or your spouse has through work.

Term Life Insurance is not that expensive. You can go to ZanderIns.com for a quote. Depending on your age and how much coverage you want it can be $30 to $55 a month.

Myth: Whole Life Insurance is a great idea, because I can invest my money at the same time.
Fact:  The truth is that the return on investments in a whole life policy are horrible and it is better to put that money in a mutual fund. Also, there is not a guarantee that your beneficiaries will receive the savings upon your death. For more information about Whole Life Insurance go here.

3. Make plans for your estate.

Making a will and planning for your estate go hand in hand.  Estate planning will allow you to decide who will get your house, cars, or anything else you want. Also, if you give your house as an inheritance to your kids, then you can avoid a high rate of gift tax. On daveramsey.com “The federal government allows someone to die and leave in their estate $2 million without any estate taxes. An individual can only give another individual $12,000 before getting gift-taxed out the ear unless they claim it as part of their estate before they die.”  You can read more about this here under the question “Is Inheritance The Way To Go?”

The estate planning process is also where you will set up any trusts that you want to leave for your kids. You can even make stipulations on whatever specific areas you want. You can specify the age that they get it and how much or that it be used to pay for college.

Myth: Estate planning is only for rich people.
Fact:  The truth is that you may be surprised by how much you have. You need to make plans for the term life insurance money or if you own a home.
4. Make a Living Will.

A living will is a legal document that a person uses to make known his or her wishes regarding life prolonging medical treatments. It can also be referred to as an advance directive, health care directive, or a physician’s directive. A living will should not be confused with a living trust, which is a mechanism for holding and distributing a person’s assets to avoid probate. It is important to have a living will as it informs your health care providers and your family about your desires for medical treatment in the event you are not able to speak for yourself. (From Alllaw.com.)

This may certainly help deter any family arguments if one family member wants to keep you on life support and another is ready to let you pass. If your wishes are known, then the family knows your wishes and they can respect them.

I would also add that it contain if you want an autopsy done or not to determine the cause of death. We had a death in the family last week and the family had to make this decision within hours of him passing. They didn’t know what to do and were not in a state to make that decision.

You can buy a Living Will at USLegalForms.com for $15 and get it notarized.

Myth: I don’t care what happens to me and the doctors will know what is best for me. 
Fact:  The truth is that you have say in the matter now and your family and even doctors may disagree on the kind of care that is best for you. You can save a lot of grief and arguments by making your wishes known.

5. Make Burial Plans.

You can make your burial plan wishes in your will. They can be as detailed or limited as you want. Making simple decisions about cremation or being buried can save your family a lot of trouble. You can let them know that a cheaper casket is okay and that they don’t have to get you the Lexus of caskets. Even if you want a full Catholic funeral with a Rosary or a simple memorial.

Myth: Pre-paid Funerals are a great idea.
Fact:  The truth is that you could spend that time investing in a mutual fund and get more for your money. You can make prearranged funeral plans so your family doesn’t have to make emotional decisions,  but you don’t have to buy your plans. If you invest your money instead, then you will have the money to pay for the burial. You can read more about it here.

6. Discuss your plans and wishes with another family member.

My husband and I often discuss our wishes to each other. It isn’t morbid, I just want to be prepared. With all the discussions and plans we have made, I know I would be okay if he passed. Of course, I would miss him and I would have to work hard at just breathing again, but I know deep down that I am going to make it. We have asked our parents what their wishes are, because we want to know. It is okay to bring the subject of burial up with your family.

Myth: If I discuss my wishes with someone else, then I may die really soon.
Fact:  The fact is that you are going to pass and no one knows when they are going to die. It is better to discuss it and save your family some grief and agony in their time of mourning.

7. Make a Love Drawer.

All of these plans and discussions will amount to nothing if no one knows where your will is. Wills are not publicly filed, so you need to know where it is in the house or safety deposit box. I know I have asked my parents for copies of their wills and they said “Sure, it is right here in the blue folder in the mounds of papers in the roll top desk.” and then they went to find it and couldn’t.  It is important to know where it is being kept. Give a copy to a friend or family member.

Put everything, wills, insurance policies, deposit box keys, burial plans all in one drawer. This is really showing how much you love your family.

Watch this video from Dave Ramsey on The Early Morning Show about how you can say “I love you!” with a Love Drawer.

Have you made any of these plans? Do you have a love drawer?