At Dave’s Request

In the comment section of Jonathan’s recent newsletter, Dave Arey asks that I post the list of questions I referenced in my comment.

Background: Several months ago, my fellow deacons and I emailed a list of questions focused on personal financial readiness to the members of our church. Our small congregation includes single people, young families and older folk. A few are retired, but most still work. Also, most are not as financially sophisticated as the typical HumbleDollar reader.

The deacons’ letter was prompted by real conversations we’ve had over the last few years with members who were facing financial difficulties or decisions. I consider the list short, but it covers topics that the deacons were asked to assist with, or that we anticipate having to address.

What would you include on your list?

Here’s ours for Dave and the other readers who upvoted his comment:

Questions for young people:

Are you teaching good money habits to your children? Do you allow them to spend all the money they are given or earn on entertainment? Or do you teach them to tithe and save? The habits they develop as children will likely be with them for life.

Do you have sufficient savings to cover routine “emergencies”, such as an appliance replacement or new tires, so that you don’t have to use a credit card to purchase them?

Do you carry a credit card balance? Are you working to eliminate this big obstacle to sound finances?

Do you have a plan to pay for the inevitable costs of health problems, such as health insurance or other third party payor?

Do you have life insurance to replace income that supports dependents?

Have you made arrangements—through your will—for custody of your minor children in the event of the death of both parents?

Have you considered purchasing disability insurance to provide an income if you are injured or seriously ill?

Are you planning for the eventuality that you will be unable to work one day? Are you setting aside money in a 401k , IRA or other investments?  

Have you considered funeral arrangements? Would it burden your family to pay for your funeral?

Do you know your parents’ plan for their finances in their old age? Will you be able to easily access their financial accounts to assist them?

Questions for older folks:

If you are nearing age 62, and thus Social Security eligible, have you considered that claiming early will reduce your lifetime income, money that you may need in your last years?

Have you considered that claiming Social Security early may reduce benefits for your spouse?

If you have a pension, do you know if your spouse will receive benefits after your death?

If you have debt, will your spouse be able to handle the debt on his or her income after your death?

Do you carry a credit card balance? Are you working to eliminate this big obstacle to sound finances?

Do you have a will? If you die without a will, the state will decide how your assets are divided. Have you updated your will since a major life change?

Do you have payable on death, or transferable on death designations for all your financial accounts? These options allow assets to bypass the probate process, thus saving your heirs both time and money.

Do you annually review beneficiaries for all financial accounts?

Do you have a letter of instruction to direct your family after your death? Are the locations of all important papers, accounts and assets listed? Are passwords to all accounts available?

Have you considered funeral arrangements? Knowing that the finances, burial site and other details are in place can be a great comfort to your family during a stressful time.

Have you discussed your financial planning for your old age with your adult children, or other trusted person? Will they know how to access your financial accounts to assist you?