Last month, while I was babysitting my four-year-old grandsons alone, it suddenly occurred to me that if something happened to me, the boys were totally unprepared to handle the situation. So, in order to quell my rising anxiety, I sat them down and drilled into them how to respond to an emergency. I showed them how to unlock the front door, which we practised a number of times. Then, I made sure they knew where their neighbours lived, how to knock on their door and ask for help. I felt much better that the situation was now under control.
It reminded me that most of us are totally unprepared for emergency situations. We are so focused on our careers and lives and family that we rarely plan for such situations and, as a result, our loved ones are left with a financial mess in their hands. I see it all the time and yet it is not such a difficult task to overcome. All it requires is time: time to list all of your assets and where they are located. Bank accounts, insurance policies, investment accounts, real estate, art etc… the whole ball of wax must be accounted for. In addition, the liabilities you have must also be enumerated, including loans, mortgages, credit card debt and anything else you can think of. It is amazing what we collect over our lifetimes and you would be surprised as to what you own – as I was when I went through this exercise. But you must do so.
Put everything down on paper, what you own, what you owe, where it is, who to contact in an emergency, who you lawyer is, who your accountant is, who your investment advisor is, with addresses and phone numbers. Where is your will, where is your insurance policy? These are all important matters which you need to record digitally or on paper. And then the big moment – you have to sit down with your family and reveal what you have and where it is. If this is too awkward, divulge this information to a trusted friend or advisor. Let me assure you, you will feel much better once you have gone through this exercise, as I did.
Remember the Boy Scout’s motto: Be prepared.
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