Now that I’m well into business school, I want to share what I’m learning about ways you can improve your financial situation (as a writer or other freelancer, whether self-employed full time or not) and your personal life by applying practical information. I will label them all “writer business” so they’re easier to find, but most of them won’t only be relevant to writers.
I spent the last few days of 2015 organizing my files. I keep copies of paperwork related to all sorts of things: my child’s medical information and school reports, my personal taxes, apartment leases, car insurance, contracts and expenses related to Lakeside Circus, and so on. I have a small filing cabinet for recent and relevant files, and a plastic file box of “archives” that I don’t need often but should keep just in case. I’ll talk more about this in another post, but today we’re going to start with the most important bit.
You need to have a file for emergency information. You need to have it today.
This doesn’t have to be complicated but it is vital. You might think it’s not necessary because you don’t have children, or pets, or investments; you might assume that a few conversations with your spouse or parents mean that you’re prepared for an emergency. Unless you have a designated spot for emergency information, and unless your designated agents know where it is and have easy access to it, you’re not prepared.
No one wants to think about dying. I certainly don’t. I have a child who needs me, a partner who relies on me. I can’t be absent from the world. Most of you have the same, and so rather than picture a time when they’re crushed by your death, it’s simpler to ignore the possibility. Or, you’re afraid that no one will care at all, so why bother planning for it?
Unless you are truly alone in the world with no friends at all, no loved ones, no parents or partners or even a cat to care about your loss, and you don’t have any desire to see your belongings disposed of, make certain that you set aside time today to put together a file of the following items:
- Your completed and witnessed health care proxy (original).
- Your lease or mortgage information, including landlord or bank’s contact information.
- Your life insurance information, including beneficiary and contact phone number.
- Your social security card/number and medical insurance cards.
- Your completed and witnessed will, which includes burial wishes (original).
- Your credit card information, including account numbers and phone numbers for the companies.
- Your banking information.
- Student, car, or other loan information.
This is the bare minimum. You can easily get almost all of this together tonight. Anything with your signature on it should be original, but everything else can be a copy. I’m assuming you will have a lot more information in your files, and within a week or so of your emergency, that information can be accessed. What I’m giving you is a list of what needs to be immediately accessible, the moment your agent learns that something has happened to you.
What’s an agent? This is the person that you designate to act out your desires in the case of an emergency. It can be any adult of sound mind that you choose. Mine is my partner, but yours can be a roommate, a friend, a sibling. Try to choose someone who doesn’t benefit as much, financially, from your death as your other beneficiaries might, if at all possible, but it’s okay if your agent is your spouse or child, too. You just want to make certain that they know you’ve chosen them, and where to find your files.
Why this stuff?
Health Care Proxy – this is the document your agent will use first.
A health care proxy (also known as a durable power of attorney for health care, medical power of attorney or appointment of a healthcare agent) is a document that lets you to appoint another person (a proxy or agent) to express your wishes and make health care decisions for you if you can not speak for yourself. – via Medicare Interactive
If you’ve been in an accident and require serious medical care, but are not dead, this advance directive document will allow your agent to be there in the hospital with you. It will allow them to assist the doctors in making choices for you in accordance with your wishes. Depending on the form you fill out, it will set up rules for end of life care.
In most states, the default is that your spouse or, if unmarried, parents will make those decisions for you. But it’s not guaranteed. Worse, in states where your parents are the default (for example) they may be the last people you want deciding these things for you. Historically, unwed partners, roommates, and children have been excluded from the decisions when absent – or hated – parents rush in and take over. Even ex-spouses can claim to be current by bringing in a marriage document but no divorce papers, and insert themselves into the situation.
If you are married but something happens to both you and your spouse at the same time, that once again opens you up to this kind of problem. A health care proxy will let you designate a tier of agents, so that if your primary choice isn’t available, the next one can step up.
You can Google “health care proxy” and your state, and usually find state-certified blank forms that can be downloaded and printed out. In New York State, for example, we can use this one. You don’t need a lawyer to look over it, though you can certainly get one if you choose. You only need to put into writing your wishes, and get two adults to witness it. (Don’t have two people who aren’t the people you’re granting power to in the proxy? Take it to your bank, or your work. Any two competent, unrelated, adults will do.)
Banking and Credit Card information – Depending on what has happened to you, it might be necessary for your agent to immediately cancel your ATM and credit cards. Even if that’s not the case, they will want to notify your financial institutions right away. Your bank will help to ensure against fraudulent use, and will be able to grant your beneficiary access. (This will be the person you designated when you opened the account. Don’t have that set up, or want to change it? Pop into your bank and let them know. It only takes a moment.)
Your credit card companies will either be able to freeze charges, interest, and payments due (if you’re merely injured) or they will start the process to close your accounts and delete your balance due, if you’re dead. You want to make certain this happens because otherwise your heirs will be expected to pay that balance out of whatever money you leave them. If you don’t have emergency protection set up on your credit cards – it usually costs only a few dollars a month – and you carry a balance ever, call your credit issuer to arrange for it. It’s like life insurance for your debt. You want that.
Loan information – like above, student loans are generally forgiven when you die, and can be put on hold if you’re temporarily disabled/hospitalized. You want your agent to contact the loan issuer immediately to start this process for two reasons: if you aren’t dead, it will help keep from wrecking your credit while you recover, and if you are dead, you don’t want any automatic payments you’ve set up to come out of the bank account you’re presumably leaving for someone else. Other types of loans will probably still need to be paid off by your heirs, but the bank will be much more likely to work with you agent on this if you contact them before the payments are past due.
Mortgage or landlord information – your agent will need to be able to get into your home, if they don’t already have a key; they’ll need to be able to arrange to keep the lights on, or to sort out a plan for disposing of your property. This is desperately important if you have children who should be able to keep living in your home as long as they need to.
Life insurance – the process to get paid out on a life insurance policy can be complicated, and take longer than you need. It’s generally not as simple as notifying them of your death and then they show up at your beneficiary’s house with a check. It could take months, so the sooner your agent can begin the process, the better. In many cases, being able to share that information with a mortgage lender or other financial institution will help in arranging delayed payments, if your agent needs to do that.
Your will – this is one of the most important documents that you could possibly have, second only to the health care proxy. However, your agent generally won’t need it until after you’re deceased. Even if you’ve only been seriously injured, though, if they have your will it will help them start making arrangements, and possibly stave off any potential disagreements that others might have about your wishes.
A will basically establishes an executor to carry out your plans (your agent is probably the best person for this). Those plans should include what you want to happen to your children, your assets, and your body, after death.
You can use an online site like Willing to help you get started – the will is free, though they do offer paid services to help you set up other types of paperwork. Unless you have a lot of assets, a simple online will might be everything you need. It’s certainly better than none at all. Remember that you’ll have to print it out and get it witnessed for it to be vaild! But even printing it out today and signing it yourself is a start at protecting yourself and your family, so do that right away, even if you can’t get to a notary until tomorrow or later in the week.
Where should you keep this stuff? Where’s the place your agent can easily find it in an emergency? In a colored file folder at the front of your filing cabinet? In a sealed manila folder taped to your refrigerator door? As long as they have access to it 24/7, and know exactly where it is, you’re good.
Any questions? Please feel free to leave comments below.