Things To Do While You’re Still Sentient

You may have reached a point in your life where you recognize that you’re:  (a) not so young anymore but (b) still have your mental faculties fully intact. If I’m describing you, this would be a good time to review my checklist of things to do while you’re still sentient.


1. Simplify your investment strategy.

Forget about complicated asset allocation re-balancing, owning lots of different funds, and other tinkering; instead, keep it simple and put your investments on auto-pilot.

The easiest and most cost-efficient way to do that is to put all of your retirement assets into a single target date fund. For your taxable assets, you can do the same thing or something similar such as a balanced fund. Chose a low-cost option; these funds are well-diversified already so you don’t need to fuss about that.

 2. Simplify your financial account structures.

Similarly, slim down the number of financial accounts you have. Roll over any old 401Ks into an IRA and merge multiple IRAs into a single one. You only need three investment accounts — a traditional IRA, a Roth IRA (if you have one), and a taxable account. Keep them all at the same financial institution.

You also have no need for multiple bank accounts so just have just one and ensure your bank account is linked to your investment account. If you transfer money to your checking account each month, automate that process so it just shows up on the first of the month without you doing anything.

You’re probably doing this already but if you’re receiving Social Security, a pension, an annuity, or other regular payments, ensure they’re all direct deposited into your checking account.

Lastly, if you have multiple credit cards, slim down to the minimum necessary.

3. Automate the RMDs (required minimum distributions) from your retirement accounts.

If you’re taking RMDs from your IRA, take the full year distribution each January, have the financial firm withhold taxes, and then automatically send the funds to either your taxable investment account or your bank account. Instruct your financial firm to do this every year.

4. Ensure that your email and your financial account passwords are unique.

These login credentials are critical to your financial health and should be safeguarded and not reused. Also, don’t connect to your email or financial accounts on a public wifi network such as the library, Starbucks, or the computer in the lobby of your hotel.

5. Even better, only use a phone app to connect to your financial accounts.

Try not to ever log into the websites of your financial accounts. Instead, use the phone apps as the biometric security on your phone is more secure and easier to use.

6. Ensure you and your spouse both have full knowledge of the family finances.

Both of you should know how the bills are paid, where the accounts are, the login credentials, the full list of credit cards, where important documents are stored, etc.

Instruct your credit card company to send a notification to both of you every time there is a large purchase and your investment firm to send you a notification every time there is a significant withdrawal.

  7. Designate a trusted contact.

For your investment accounts, you should designate a trusted contact.

The SEC website defines a trusted contact: a person that you authorize your brokerage firm to contact in limited circumstances, such as if your broker has trouble reaching you or has a reasonable belief that your account may be exposed to possible financial exploitation.

Note that a trusted contact cannot withdraw funds from your account.

They also helpfully explain why you may want one:

  • If your brokerage firm cannot reach you, adding a trusted contact person to your brokerage account may help your firm ensure that your current address and contact information are correct.
  • Adding a trusted contact person to your brokerage account may help your brokerage firm respond to possible financial exploitation or fraud in your account and protect your account’s assets.
  • If your brokerage firm suspects that you are experiencing a health issue, adding a trusted contact person to your brokerage account may help your broker confirm your current health status.
  • Adding a trusted contact person to your brokerage account may help your brokerage firm verify the identity of any legal guardian, executor, trustee or holder of a power of attorney on your account.

 8. If you engage a financial advisor, determine whether you can trust them.

If you fully trust your advisor, then you’re fortunate and in good hands; if not, you need a new strategy for how your wealth is overseen — a new advisor, a family member, or review my points 1, 2, and 3.

9. Review your will and designated beneficiaries and ensure your decisions are still as you want them to be.

Now is a good time to update them if there have been relevant life changes.

10. Create a written document with the financial information your loved ones will need when you turn up dead or demented.

I have one and it’s called, appropriately, Things to know when I’m dead. You may want to list financial accounts, where estate documents are located, outstanding debts and credit cards, insurance policies, safe deposit boxes, etc.

Share it with the future executor of your will and any other trusted friends or family. It won’t help you but it will help them.

If you wait to do these things until it’s too late… well, it’s too late and it will be messier and costlier to sort out these issues.

There’s no better time than a cold winter weekend when you’re stuck inside during the Omicron phase of the pandemic with little else to do. Go through this checklist and make any necessary changes. It’s a one and done effort and then you can forget about this stuff and go on living your sentient life. You may even have a bit of fun writing your version of Things to know when I’m dead.

Questions?  Get in touch

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