The Prophet Isaiah was instructed by the God of the Old Testament to give a specific message to King Hezekiah. It included the words: “Set thine house in order; for thou shalt die, and not live” (2 Kings 20:1).
Clearly, God expects us to take reasonable measures to set our houses in order in preparation for our possible death.
“You can’t take it with you” is a common axiom. As Job stated, “Naked came I out of my mother’s womb, and naked shall I return thither: the Lord gave, and the Lord hath taken away; blessed be the name of the Lord” (Job 1:21).
Simply put, our property and wealth do not join us in the grave. Therefore, most people want to give their possessions and wealth to certain other people or organizations when they die. Often they want to give it to their spouses, children or other relatives.
In fact, taking care of our families is a responsibility clearly mentioned in Scripture: “But if any provide not for his own, and specially for those of his own house, he hath denied the faith, and is worse than an infidel” (1 Timothy 5:8; see also 2 Corinthians 12:14).
Our wealth and property are blessings from God. Of course, we are supposed to take care of them in life. Doesn’t it follow that we should make plans for those blessings in the event of our death? As God expects us to be good stewards, shouldn’t we make at least minimal arrangements for how our blessings will be distributed after we die?
In our complicated modern societies, the red tape surrounding death can be nearly immeasurable. Without proper planning, we cannot be certain our wishes for our estate will be carried out.
Make Some Decisions
The first thing we must do is decide exactly what we want to happen with our assets when we die. To begin, make a list of what you have. Don’t forget checking accounts, savings accounts, certificates of deposit (cds), stocks and insurance policies, as well your physical possessions.
Now, what do you want to happen with those things if you die? Don’t think you will not die for a long time and can put off making such plans. Accidents are responsible for thousands of deaths each year, so your age should not stop you from doing this.
List exactly what you want to happen if you die. If you are married, your spouse will most likely be the focus of your thinking. If not, you may have children, brothers or sisters, parents or friends you want included to receive some or all of your estate. Many people include charities or other organizations they feel are worthwhile.
Now you need to take steps necessary to see that your wishes are carried out as you would want them to be.
Ensure They Are Carried Out
Many tools are at our disposal to help establish exactly what our wishes are. Some work much better than others; some cost more than others; some are much more complex than others.
At the very minimum, a person should make a will. However, a far better tool to ensure that your heirs receive what you want them to is a revocable living trust.
Creating a revocable living trust may be one of the biggest gifts you can give your heirs. It is a gift because it clearly and legally outlines what you want done with your assets when you die. It will greatly reduce the stress of those you love and will greatly reduce hard feelings and possible fighting that may result if you do not indicate what you want done with your possessions.
It is especially important to set up a revocable living trust if you think that some of your heirs may challenge your will, or if it might be considered controversial—for example, if you decide to leave a large portion to a charity, a non-relative, or some other organization. This will greatly reduce the risk of your estate being challenged in probate court and your assets being disposed of in ways you do not intend.
Avoiding probate will also save your heirs a lot of time and money. Once an estate is in court (as wills are required to be), everything is at the mercy of the legal system. Courts can essentially do whatever they want to do, and the costs and delays can be massive.
If you have children, you will still need to have a will in order to designate who will look after them. If you do not have it legally documented, the state will determine who will raise your children.
An Important Tool
There is another simple tool available to people in the United States (that may or may not be available in other countries) for distribution of such things as savings accounts, cds, check accounts, money market accounts, mutual funds, most stock or bond accounts, and various other “cash”-type assets.
This tool is remarkable for three primary reasons. First, it is cost-free. Second, it is simple. Third, it works.
All it takes is a 10-minute trip to your local bank to put this tool in place for your checking and savings accounts. No hassles, no delays, no cost. You gain the assurance that if you die, any money in those accounts will go exactly where you want it to go.
The tool is called a “payable on death” benefit, though there are other names for it. It is the best way to transfer funds at death to the person, people or organization you want them to go to. If you are married and have joint accounts, it requires both of you to die before it is activated.
Essentially, you assign a new owner to the account. That owner will instantly assume ownership control at the time of your death. The assets do not go through probate, a time- and money-consuming process. They do not remain in your estate, as they are instantly, upon your death, the property of the new owner.
If you ever wish to change the beneficiary, all you need to do is make another brief trip to the bank or institution holding your account or accounts.
To “collect” the assets, the new owner will be required to provide the bank with a certified death certificate and proper identification. They may be required to show two forms of identification by some agencies, but that’s all there is to it.
This is a remarkable way to ensure your assets go where you want them to go. Since ownership actually changes, it is nearly impossible for anyone to contest or interrupt the transfer of funds.
Some states also allow for the transfer of your possessions held by a title or registration—for example, cars, trucks, motorcycles, snowmobiles, boats, planes, motor homes or travel trailers. This is called “transfer on death,” or something similar. In the states permitting this type of transfer, simply go to the office where titles are registered and ask for the forms to transfer title upon your death. Fill the forms out and pay any required fees. In most states, the fees are minimal for this service.
Once that has been done, when you die, the property will be transferred to the person or organization you have named on the “Transfer on Death” form. This will avoid delays, additional costs and other complications that can arise after death.
Only for the Rich?
Sometimes people think estate planning is only for the rich. In reality, exactly the opposite is true, especially for a “payable on death” benefit. The less money you have, the more important careful planning becomes. Without proper plans in place, your money will be consumed by the courts and attorneys, leaving nothing for those you love. A payable-on-death clause attached to your accounts and other assets allows even the smallest accounts to be transferred to the person or organization of your choosing without costs and delays.
You may list more than one person or organization as owners. Some institutions will give them equal portions, while others will permit you to specify percentages or fractions to each.
If you choose to make an organization the beneficiary at your death, you may be asked to provide the federal tax number when setting up the payable on death benefit. Contact that organization to get its proper address and tax number.
It may be a good idea to let your beneficiary know about the account; however, if you decide to change beneficiaries, that can become a bit sticky. If you do not tell a beneficiary they are listed on your account, then leave a statement where it will be found when you die. Be sure to list the institution by name and address, the account type, account number and any other instructions the bank may provide. This way, if you change the beneficiary, you will not have to tell someone that you are removing them from the account and will avoid the possibility of hurting someone’s feelings.
One final word of advice: When storing documents to leave behind in the event of your death, do not put them in a safety deposit box. Sometimes such boxes are sealed upon the owner’s death, thereby denying access by trustees or executors and forcing the estate into the courts. Keep them in a fireproof, safe location at home, and make sure you tell someone where to find them. It may also be a good idea to give a copy of your estate papers to the person who would receive the trust upon your death.
A living revocable trust, a will, and payable-on-death benefits are excellent mechanisms you can use to be certain your house is in order and you are providing for your own as instructed by God’s Word. Using them will also give you some peace of mind, knowing your assets will go where you want them to go should you die.