You know, if we love those we are going to leave behind, we should take steps to make their lives easier. In the February 6, 2012 issue of Investment News, there was a report on a study done by Northwestern Mutual. The study found that the approximate average cost for five years in a skilled nursing facility is $500,000. In a survey by Northwestern of 2,194 adults, 80% felt that there is a greater need for long-term care now that people are living longer. No surprise there. Also, 67% believed that the cost of providing long-term care will rise faster than the return on their retirement savings, and 53% think that long-term care costs will double in the next 14 years. 45% weren’t sure how they plan to address their own potential long-term care needs, and less than 28% were currently saving for future long-term care expenses. If you are a senior adult with children, don’t you think it is time to plan for the probability of needing some form of assistance later in life? There are ever-evolving solutions to this future financial jolt, but they should be implemented while you are mentally and physically stable. If you are the child of a senior citizen, you will do yourself a favor if you insist (gently, of course) that some plan be put in place. You may find that the funding may have to come from your resources, but it could be money well spent. Talk to your legal and financial advisors, and get the ball rolling before it goes flat.
In a somewhat related matter, be cognizant of the problems that can occur if there is a sudden illness or accident and documents allowing access to financial records are absent. The discussion of third party disclosure forms, rules, regulations, etc. should take place while you, again, are physically and mentally alert. I think the time spent discussing this action with your team of attorney, accountant and advisor will be well worth the effort. It is generally easier to plan for the unforeseen than to react to the event after it occurs.
If our local paper is any guide, a lot of our friends and neighbors made their final visit to a funeral home in December and January. There are families now trying to deal with what was left behind. An article in the February 5th edition of the Wall Street Journal offers some advice. First, take your time in sorting out the lifetime accumulation of “stuff” that includes items that will bring back memories—both good and bad. However, don’t use the sorting to avoid taking action to close out the estate. If you need help, there are several routes to consider. You can hire an estate liquidator. I found one that, for a percentage of the sales, cleaned up the house, tagged all the furniture and other items, held the sale and cleared out everything that didn’t sell. Another option is to use a consignment shop. According to the article, they usually charge 50% commissions and will put the items on their floor for 30 days. After that time period, they will give you an agreed upon time by which you have to pick up the unsold items, or ownership reverts to the consignment shop. One other idea is to have an estate auction. In addition to dealing with household items, you have to pay attention to monthly bills for utilities, insurance, credit cards, etc. Failure to keep tabs on these items could result in late fees or billings for services not used. That was the easy part. Division of family treasure can be a show stopper. The easiest solution is to have the discussion of asset division prior to death. I suspect that this is not the norm. In the absence of a prearranged division, the family needs to decide who is in charge and give that person final say. Determine who was promised what and who wants something that was important to them. Consider giving everyone color coded labels to tag those items that they have an interest in, and develop some sort of spreadsheet to help with the negotiations. There should probably be values assigned to the inventory so that any division of assets is equitable from both monetary and emotional perspectives. Anything not claimed or sold should be donated to charity.
I heard a song from my past last week. It was “I Couldn’t Live Without Your Love” and was sung by Petula Clark in the mid 60’s. I know that this is a song meant to celebrate a successful courtship, but I can also see it as a song of praise by a happy believer in or convert to our God. I am chopping up the lyrics to some degree, but I think you will get the drift. “Didn’t like you much when I first met you, but somehow I couldn’t quite forget you. But as time went by, my love grew stronger; knew that I couldn’t wait any longer, for I couldn’t let you go and I had to tell you so. I couldn’t live without your love, now I know you are really mine, gotta have you all the time.” From Matthew 10:27: “What I say to you in the dark, tell it in the light; and what you hear whispered, proclaim from the housetops.”
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