Estate Planning seems to be a terribly boring subject, however, it really comes down to being something that many people either don’t understand, or don’t want to understand and therefore find ways to avoid.
You need an estate plan.
I’m not talking about some complex dynasty trust, or other technique to avoid taxation, I’m just talking about clearly mapping out the steps required to get your shit together when you are either dead, disabled, or arrested for downloading porn while mileage running to North Korea.
What happens when you are suddenly unable to close the loops that you have opened for money ‘in play’? I call money in play when it is pushed out of the typical financial ecosystem. For example, if I were to load $1,000 to my Serve card my net worth would look like this:
To the untrained eye (perhaps a spouse, or an external executor of my will)
- FIA Amex ($1,000)
- Checking Account $10,000
- Net Worth $9,000
However, a trained eye would know:
- FIA Amex ($1,000)
- Serve $1,000
- Checking Account $10,000
- Net Worth $10,000
The Purpose of the Estate Plan
The estate plan should be a way to make the ‘untrained eye’ see what the trained eye does. It’s one of those contingency plans that kicks in when you are unable to manage the loop. The painpoint, as highlighted in the net worth examples above, is that liabilities are often visible (linked to vanilla credit card accounts) whereas the corresponding asset is often invisible.
If these assets are missed then they could sit in limbo for years, and may or may not ever be discovered. Short term, this could mean that the executor would liquidate other assets in a fire sale as it would appear you were in dire straights.
I’ve been examining 3 products this week for formal Estate Planning, they are:
Estate Planning Tools
These are cloud based products where you can store documents, including financial accounts, wills, etc. When it comes to MSers this would probably need a list of ‘patterns’ and any automated transactions that need canceling (autoloads are the opposite of autopays, and create, rather than eliminate liabilities).
The above are pretty hardcore products for this need, but do a great job. And if you are spinning up tens of thousands of dollars each month then the cost should be negligible.
I just got 1Password as a bundle for Mac and Windows. You have to buy a Mac version (covers all your macs but not iPhones) or a Windows version or both if you live in a house like mine. Then the App requires another payment…so you can access these sites from your mobile. There are other options available, but this works for me. Whenever I buy something like this I always google terms like “1password coupon code” and doing so created a hit on coupons.com “MacPowerUsers” for 20% off.
The drop down list gives clues.
The advantage that this has for your estate plan is that (providing your executor/survivor knows that passphrase) they can access all your online accounts, and many ‘gigs’ are online. Not only this, but it has a drop down list of all your stored logins, so they might never have known you had an account with Wells Fargo, but there it is.
Mint, or other budgeting tools can help collate a lot of financial accounts. While I dislike mint as a tool because tracking MS in it is too cumbersome, it is a place where you could easily create overviews and snapshots of your accounts.
Cloud is key
Security may well be an issue for many, but when you have a lot of data, it is great to have cloud access. This allows people you want to access your records. The risks are obviously that people you don’t want may also be able to access them. A password manager may help mitigate that as it allows you to build more complex passwords, which is great until someone hacks the master account!
A cloud solution may be Google Docs, or DropBox -both offer free products where you could store a spreadsheet and a word document.
Keep data, and a narrative
A spreadsheet alone is hard to follow. A narrative explaining each product, or a link to a nice bow and arrows post by one of the titans will allow your survivors to not just identify the location of the account, but also understand the money flow. This may be useful for times such as when you pay something online on Day 1 and are expecting a check to arrive on Day 6.
Ghostbusters anyone? There was a gatekeeper and a keymaster. A non technical solution may be to designate a MS executor on top of your formal estate executor. Think of it like a buddy system. For example, from hanging around in the forum I know that there are many people who ‘get it’ when it comes to MS and would be able to quickly look for gig patterns.. they could tell Allison to look at my paypal for transactions, ask if I have a ST or UFB account, or even look at credit card statements for bank account purchases.
Heck, just peeking in my wallet would tell a lot about what I was doing. Having a buddy to help sort through everything could be very useful, and might be something to consider. It’s really very common to have just one half of a family involved in this wacky game, so giving them the tools they need to pick up the pieces is very important.