Your Parents' Finances: how do you pick them up?

http://www.fatwallet.com/forums/finance/836279/


As someone whose father dropped dead suddenly and unexpectedly at the age of 51 three weeks ago, I cannot stress to you the importance of discussing these things with your parents sooner rather than later. And having a will is simply not enough... you must know where the original signed copy is located, as I have learned that a copy of the will is not sufficient. Don't assume that the lawyer who drew up the will has a copy; he/she likely does not and if they have a copy, again the original is needed. And without a will, the estate will be intestate and subject to your state's succession laws. Here in Kentucky, the first $15,000 of the estate goes to the surviving spouse and the remaining money split 50% to the spouse and the other 50% split among surviving children. I have also learned that it's not possible to disinherit a spouse; even if a couple were in the process of a divorce or not living together, the spouse still gets the lion's share of the estate. Although this doesn't seem to be an issue in your case.

It's also imperative that you work with your parents to check their beneficiary designations on things such as life insurance, IRA's, 401K etc. Ensure they have established a beneficiary (or updated it recently) and whenever possible that they have set accounts up to be "payable on death". This allows these things to avoid going through probate, which can be a very lengthy and costly process.

Don't be afraid to talk to them about it! Lest you end up like me, having to serve as administratrix to an intestate estate with seven rental properties. As for accounts and things, those aren't too difficult to figure out. Gaining access to my father's credit report gave me a very quick and pretty comprehensive idea of where he had accounts and what the balances are.

And don't think that sudden death can't hit you unexpectedly. My father was healthy, relatively young, and strong. Worked a full 8 hour shift on Friday and dropped dead the very next afternoon of a massive heart attack. Neither he nor anyone in my family would have ever in a million years expected this. So this goes for you, OP, and everyone in this thread... talking about estate planning is something that MUST be done, no matter how awkward or unpleasant and no matter how unlikely it is that you think your parent will die anytime soon.

The most important things are: finding out if there is a will and, if so, where you can obtain the original signed and witnessed copy (better yet, ask them to draw up another original copy that they will sign that you can keep yourself); finding out about any safe deposit boxes and where they are; and learning of life insurance policies because if these are obtained independently (not through the employer) it might be difficult to find (although you can pay to have an insurance search done).