Life Inventory: The basics

Life inventory: everything your family needs in the event of your death or incapacitation.

Many books about financial planning discuss the basic estate documents.  These include

• Will
• Financial Power of Attorney
• Medical Power of Attorney
• Living will

When creating these documents, you need to both decide who you would like to perform these functions and then discuss your wishes with them.  Simply assigning these responsibilities to someone without talking to them means they might not know your wishes when they have to make important decisions.  In fact, I recommend asking the person that you wish to designate in that role before assigning them.  This is especially true if you are granting guardianship of your children in a will.

I also recommend discussing your wishes in regards to how you wish to be cared for in the event of your incapacitation for your medical power of attorney.  Since I trust the person that I’ve assigned this responsibility to, I’ve told them to do for me what they would wish done for themselves.

If you ask an attorney to create these documents for you, you will also be asked for an alternate person (in the event that the person you designated predeceases you).  I elected to designate someone outside of my household, in the event that both my wife and I were incapacitated in the (for example) the same accident.

When I first had my will created, my children were small, and so the most essential reason for my will was to designate guardianship of my children.  I asked my parents to be my children’s guardians and then if something happened to my parents, one of my siblings would have been the guardian.

Once you have created these documents, you should make copies.  Keep a copy for yourself and send a copy of each document to the people identified in those documents.  Let everyone know where those copies are  (I happen to keep one of my copies in my safe deposit box, but I have been warned that some states seal safe deposit boxes) and discuss their contents with the family members most likely to have to use them (spouse, adult children, parents, etc.).

The rest of my blog entries on this topic will cover other types of information that you might want to include in your life inventory.  While the documents discussed here are *legal* documents and can be enforced, the rest of the life inventory is informational and not legally binding.