Tragic experience leads to estate plan tips

submitted by Theresa, after Choice Moms started delving into the subject, partly because of the "Choosing Single Motherhood" radio show on the topic (see ChoiceMoms.org for details)

I have some advice for those new to this topic having just started and gone through my own processes around this. There are even things to consider now that our economy is going through a tough time that we may not have had to consider a couple of years ago if we had done this then.

Guardianship/Will: I found a reputable family attorney who helped me with my legal will and guardianship paperwork. A couple of things I did was decide to...
(1)"Gift my home" to my child. When my son is born the home will be gifted to him in the deed "upon death." NOT at market value at time of purchase. Very important. This means if you ever die or you get into an accident and since your baby is your beneficiary, though you may have a will, you need to make sure that your home is never taken to pay off any debt and your child inherits it. I tell you this from experience. Some attorneys don't even realize that gifting needs to occur in a special way for younger beneficiaries.
(2) Guardianship - I not only chose parental guardians but in my case I listed a contingent guardian as well as financial guardian. For example, my sister (though would raise my son well) has a job that is not conducive to how i would raise a child due to the high risks of her job and the fact she is moving around constantly. She is however, EXCELLENT with finances and would do what is in my sons best interest when it comes to his inheritance, life insurance, etc. So I decided on a best friend for parental guardianship and my sister as contingent, but the sole financial guardian with my aunt as her backup. I of course met with each and told them of my wishes and got their blessing to proceed - something very important.
(3) the will is a will... basic standard but doesn't hold much in court unless you take care of your financial status and beneficiary status at EACH account and not to mention sneaky banks trying to not lose more money! I know this from experience too. Especially in the state of NY! So with that.....

Accounts/ Life Insurance/ Beneficiaries:
(1) The REP: You will need a good financial rep and/or accountant (I decided to find both - one to tell me how to approach best in this economy and the other to manage the accounts).
(2) LATE STAGE PREG BENEFICIARIES: make certain that once the baby is born (and issued an SSN) your paperwork is complete leaving your assets (w/instruction ) to your child, to be signed and mailed. Before birth/ssn make sure they place a clause stating "any children of jane doe, etc" so that God forbid you get sick during birth, etc. or become incapacitated other ways your child is taken care of.
(3) Life insurance: 3 times your salary is best, no matter what advice they say - "wait until later, they don't need that much now, etc."... not true!
(4) SCHOOL: plan for college. Some reps can get you an account specific for this or tell you about alternate accounts or bank accts to open... like Long term CDs, etc which do not require much money for you to open them, but grow nicely over time. Esp the next 17 years.
(5) Savings accounts at banks allow beneficiaries BUT checking accounts do NOT. I didn't realize this as did many of my other friends when we filled out the little beneficiary card! It is important to make sure that the surplus of your money is left in savings and only minimally in checking as needed. A bank will make it difficult to get the checking closed and the money there will have to go into an estate account where your guardians/child needs to file court docs each time to open and close the account as applicable. Annoying!

Most important part of all of this!? MAKE SURE YOU KEEP COPIES of everything. Not just a list of the accounts and their numbers and telephone numbers BUT if you elect beneficiaries, let's say, on a website at work, etc.... make sure you PRINT a copy of the fact you submitted that and it was saved. Here is the kicker (AND THIS HAPPENED TO ME!!!!).... MAJOR companies and banks that are trying not to lose 'more' money have this new approach.... they (a) Claim that there are no beneficiaries listed even though you have a nice list laid out... so to get those funds becomes a freaking nightmare and court battle in surrogates court. The calls, the data, etc. suddenly disappear. You trust them to hold the data but when they see the amounts (if larger over time) they do a sweep. If my own mom did not make sure to save copies of statements (and she saved everything and is not the norm) we would have never been able to get any funds or go to court to fight for them. (b) Claim life insurance was dropped by either the company or the policy holder. Make sure the policy and end date paperwork is saved safely.

Anyway sorry for the long email but having lived the experience and now doing my own I am finding all these things are a great help.

I at first didn't think I needed to be so cautious until a dear friend of mine, Susan, who was in her 8th month, was in a car accident. He baby delivered fine but she was in a coma for some time and eventually passed away. Had nothing done and well, unfortunately everything was in shambles for some time. She had a boyfriend so was not an SMC BUT did not list him either so it became a freaking nightmare for that family.

And I recently went through some of the crazier company stuff when my mom passed suddenly and my younger sister and I had to go to courts to exercise the will, which became meaningless in NY without all the other stuff.

Hope this helps those that are interested in some hard-earned advice. :-))