Most estate planning attorneys have received calls from distressed children who knew that a deceased parent had a will or a trust, but had no idea what accounts, insurance policies, or items of real and personal property the parent owned. If an inventory was never prepared and shared with the parent’s attorney, the child likely had to spend countless hours meticulously combing through the parent’s file cabinets, drawers, tax returns, mail, and online accounts to identify what the parent owned.
Needless to say, this is not something that anyone wants to happen. A detailed inventory of all of your accounts and property is crucial for helping your loved ones manage your legal and financial affairs effectively. Creating this inventory of your accounts and property does not need to be very complicated. It can be a simple word processing document or even a handwritten list.
Many individuals create spreadsheets in software programs like Microsoft Excel, Numbers, or Google Sheets. There are also online services that can help. The bottom line is that any of these methods can work well—the important thing is that you create an inventory.
As you create your inventory, you should also review how property is titled or who is named as the beneficiary on certain financial accounts.
Once you have created and shared your inventory, you should create a plan for updating it. Over time, accounts get closed or consolidated with other accounts, property is sold or acquired, and retirement accounts get depleted. If you do not regularly update your inventory, there is a chance that you could create confusion and send your loved ones down rabbit holes as they try to handle your affairs.
Some people find it helpful to choose a specific date each year when they will review and update their inventory and also review their estate planning documents. Whatever will work best for you, make a plan, implement it, and then stick with it. Your loved ones will appreciate it later.