As survivalists and preppers our main focus is staying alive … We prepare constantly to survive any scenario we come up against.
But Benjamin Franklin said there are two things in life that are truly inevitable.
Hopefully you have your taxes handled. Your annual tax returns are due to the IRS now (actually yesterday). There’s really no choice but to prepare – and pay – our taxes every year. But the other inevitability – death – is often neglected or poorly planned for.
Death is Something to Prepare for
Someday you will die, your loved ones will die, and life will continue on without us. But you can leave your legacy behind and intact with proper planning.
I’ve made my peace with the idea of death over time. But even if you make peace with the idea of your own mortality there are certain steps you need to take in order to avoid your death – or the loss of a loved one – becoming a total financial and emotional disaster for those left behind.
You can’t take it with you when you go …
It’s true. The riches – or junk – that people amass over their lifetimes can’t accompany them to the afterlife.
And when possessions of the deceased are being divided among the living … things can get ugly quick.
We’ve all seen it. A relative passes away, the family forgets that they’re family and go to war over the loved one’s possessions and/or left-over funds. I’ve personally witnessed families torn apart for decades over who got Grandma’s handmade doilies, doll collections, or few thousand dollars after the bank and lawyers took their cut.
Personally I don’t want my family to fight over my possessions when I’m gone. Or for my estate to be handed out piece by piece by the government. That’s why I’m taking specific actions to protect our family and that you should consider preparing for death too.
Here are the main ways that people prepare for death:
1. A Will
Having a proper will written by a good lawyer could save your family from themselves someday. Also ensuring that your loved ones have their own wills can make your life much easier in the event they pass away. It may be a hard subject to broach but it’s an important one.
If you have any assets – you’re never too young to get a will drafted. Many young people pass away without wills because it’s considered something old people do. Or even an admission to your mortality that most younger people aren’t willing to make. You can change your will as many times as you wish and it’s really easy to do. This means your will can grow and change with you as the circumstances of your life changes.
A proper will is also very important for anyone with children. A will can state who becomes the legal guardian of your children upon your death, and can ensure that your estate is used properly to secure a future for your children. And your will will also make sure your assets are used solely to provide for your children.
Without a will the state will divvy up your estate how they see fit. And the legal battles that ensue between family members are usually epic conflicts charged by emotions and entitlement. Sometimes there is little to nothing left of an estate by the time the legal system and lawyers get their cut if your estate is drawn into a lengthy court battle.
Your will also tells the courts who gets what. If you have a family member that would have a legal claim on your estate in the event of your death and you don’t want them getting anything it’s as simple as disinheriting them in your will. It’s common that people who have not been a part of a family for a long time – even due to divorce – to make legal claims against an estate and take substantially from those you wish to gift your life’s accrual too.
Your will also determines who manages your estate. This way you can ensure someone you (and your family trusts) manage your estate and the inheritances.
A DIY will has strong legal standings in the US and most parts of the world. However hiring a professional lawyer to draft your will can make it much stronger and ensure that your wishes are obeyed.
2. Tax Free Lifetime Gift
Death and Taxes aren’t just inevitable – they go hand in hand!
A ‘Death Tax’ exists in just about every developed country.
In the USA the estate tax (death tax) only affects a small portion of estates. Of course proponents of the death tax claim that it only taxes the wealthiest families. Estates valued at roughly over 5 million are subject to this tax. Recently lawmakers were trying to lower this threshold to estates totalling a value of just 2 million.
Wealth is abundant in multiple forms. In fact owning land in any real quantity can easily qualify an estate to be subject to the death tax. Land has value, and even though it’s not a liquid asset it still counts into the value of the estate. Farms and ranches all over the US are torn apart and sold off just to pay the estate taxes every year. It makes being a large land owner and passing that land to your children and relatives fairly difficult.
One option is that later in life you can gift parts of your estate before your death to family members. Currently you’re allowed to gift land and other assets before your death – tax free – to a total value of a little over $5 million.
3. Donating your Estate to Charity
Charitable donations aren’t taxable in the US. And that holds true for estates donated to a valid tax-free charitable entity.
It’s possible to donate a portion of your estate in your will to a charitable entity in order for your remaining estate to be below the threshold to be divided up to the beneficiaries without the tax burden.
Care about preserving hunting for future generations? You can donate your estate to Ducks Unlimited. Protecting the 2nd amendment? … the NRA will gladly accept your estate.
4. A Living Will
A living will is an advanced directive that specifies what happens and how you’re taken care of if you are incapable or incapacitated. A living will often comes into play when someone is hospitalized. Family members could wind up with power over your estate before you’re gone. Not everyone will wait until you’re dead and crazy things can really take place. A living will can help keep everyone in line.
A living will protects you – and your estate – if you wind up in medical care for an extended time before your death. It’s not uncommon for people to start laying claim to the estate of a person dying in the hospital before their death. Or relatives fraudulently spending all of your assets before you’re dead because you didn’t have a living will with clear directions. (You also want your living will to give power of attorney to someone you really, really trust).
5. Pre-Plan Your Arrangements
Many people will pre-plan and pre-pay their funeral arrangements. This means that it’s taken care of and your loved ones don’t have to make those arrangements directly after your loss. Funeral arrangements can be a large financial burden and unless there is money set aside for it the funds may have to be covered by your loved ones. Those costs are often recouped from the estate but if tied up in legal issues may take a while.
Plus this helps you control what happens to your remains. Where you’re buried and in what state … Coffin, or an Urn etc.
6. Organize Your Finances and Records
Often people die with their lives in a total state of disarray. This can make dealing with the affairs of the deceased very complicated. You have bills and debts – after all you’re only human. Even after death those debts will be collected by debtors from your estate, and in some instances from your family members.
Many loans and debts that are in the deceased’s name only aren’t a big cause for concern. But any loan that is cosigned by a relative become that relatives responsibility.
Here is a short and informative article about who inherits your debt: http://blog.credit.com/2014/09/who-will-inherit-your-debt-when-you-die-97141/
7. Record and Protect your Passwords
There are so many passwords, usernames, logins, and access codes for all aspects of your digital life and private records that your family will likely need to access if you pass away. Someone whom you trust should be able to access this information if the need arrises.
8. Power of Attorney, Executor of the Estate, and other Players
Picking the players who will handle the affairs after your death is an important part in planning your own affairs. Someone will need power of attorney for you if you’re incapacitated before your death. Someone who will protect you and your estate.
The executor of your estate handles all the financial and assets of your estate after you die. They’re responsible for determining and dispersing your assets as you outline in your will. Some lawyers recommend the executor of your estate be someone that will not benefit financially from your death …
Preparing for the end doesn’t seem like something a survivalists would focus on or prepare for. But survivalists also consider the survival of their family and loved ones. Making sure they’re not left out in the cold upon your death is a sound prepping strategy.
Remember that tomorrow is not a promise, it’s a gift! What are you doing to prepare for death?