It’s something most of us don’t like to think about but unexpected death is possible for us all. And while it might no longer be a concern for us, what bank accounts or investments we have and where they are is going to be important to know about for those we leave behind.
“It’s the situations that arise unexpectedly, that can become problematic and leave people under a lot of stress,” says Niamh Moran, partner at Carmody Moran solicitors, of an untimely death.
The advice? Don’t add to this for those you leave behind by leaving a difficult trail that would puzzle even Agatha Christie. That includes details on that dodgy boiler than needs a certain touch to kick-start it each winter, your Netflix password, and where those PPS numbers are kept.
Inspired by a chat on askaboutmoney.com, here are some tips on creating a document of sorts that sets out anything your family should know about.
Make a will
When your die, your finances live on. Until your executor or personal representative informs financial institutions of your demise, money will continue to transfer into savings accounts, charges will be incurred on your account and direct debits will be paid as usual.
But what happens if your executor is unfamiliar with your accounts?
As Moran says, “They [financial institutions] are only going to find out [the accountholder is dead] if the executor knows about [the account] and knows to write to them”.
To reduce stress at a difficult time, it is important to keep track of such accounts and financial information.
A will is obviously an essential item to have, as it will set the ball rolling much faster when it comes to probate. But many of us are lacking on this front.
Earlier this year, Capital Credit Union in South Dublin ran a survey which found that of 4,000 people polled, two-thirds did not have a formal will in place. And why not? A third of those without a will said: “It’s on my to-do list, but I haven’t managed to do it yet”.
As Pat Byrne, CEO of the credit union says: “People say ‘I’ll leave it for another couple of years’, and put it on the long finger.”
And even those who do write a will, how many of keep it updated?
“People should review their will every two to five years,” says Moran, adding that “some people would be in every year changing their will!”
For many of us however, doing it once is enough.
“For some people, it’s really difficult to make their will and to put their mind to it,” says Moran, adding that these people are unlikely to reconsider their will, “unless circumstances dictate” they do so.
Circumstances such as tax changes might dictate this – Moran notes that expected changes in the inheritance tax regime in the upcoming budget should make some people think about their estate.
But even among those who do have an up to date will, it would not be standard practice for that document to list details of their financial assets. So a will on its own will not avoid unnecessary detective work, confusion and the possibility of unknown assets or accounts living on in the nether world between their now deceased owner and the people they had intended should benefit from their estate.
Keeping track
Pensions, insurance policies, bank accounts, investments etc are all liable to change over time.
“The job you’re in now mightn’t be the job you’re in in 30 years time; so how will they [the former employer] know something happened to you?” asks Moran.
If you’re not as proactive as you might like to be, you can still make it easier for those you leave behind, without too much effort on your part. After all, as Moran says, what’s important is that you know where the person has their money – it doesn’t matter too much about the particular accounts, and the sums in each.
“Once someone knows the financial institution, they [the institution] will be able to do a full check on that person,” says Moran.
And if the accounts have since been closed, it’s no issue; at least you knew about them in the first place.
But how to create such a list?
“Your list of assets can include anything like bank accounts, credit union accounts, any shares, savings and investments that you have, as well as insurance policies, pensions, lump sums, and maybe also tangible valuables, such as family heirlooms or paintings,” advises Byrne.
One way of doing it is by creating a password protected document and letting your executor or a trustworthy person know the password. But this may require regular revision.
There is an easier way.
As Moran notes, most people probably have somewhere at home they keep their private papers, and where they allow their statements etc mount up.
“In my house there’s a drawer,” she says.
Such a place is a “good starting point”, she says, noting that it would be easy enough to create a folder with a document from each institution in it, which might suit someone “who moves their money around a lot”, adds Moran. If statements come in via email, print a page and put it in the folder.
“You don’t have to put account details with the amount in them,” says Moran, adding it can just be a “really bland letter” with no real personal information in it. But it will alert your next of kin to the fact that you have accounts with that institution. And the institution can take it from there.
Don’t worry about passwords; typically your accounts shouldn’t be accessed in the event of your death until the executor contacts the institution etc (although most banks will allow a withdrawal of about €5,000 or so for funeral expenses).
Accessing accounts
Knowing about your financial interests doesn’t mean those you leave behind will have access to them. So what can you do to allow for a situation, particularly in the event of an unexpected death, where your loved ones need access to your money?
Typically, Moran recommends couples keep a joint account.
“It does make things a lot easier,” she says, adding that “If your accounts aren’t joint, it can take a bit longer” to get access.
For unmarried couples, having some joint finances may be even more important, as probate etc may take longer.
An advantage of a joint account is that the principle of “survivorship” applies. This means the funds can pass directly to the other named accountholder(s) – the survivor(s) – so that a surviving spouse is not restricted in accessing money in the days and weeks that follow a death.
Moran is less bullish on joint accounts between older parents and adult children, noting that they “can be problematic”.
“Generally speaking, it’s a bad idea for families,” she says, adding that, where they are necessary, it is advisable to put some controls on the account.
If your accounts are with a credit union, availing of the nomination process might make sense. This allows you to nominate someone (or several people) who will benefit from your account in the event of your death.
“This supersedes any other will up to an amount of €27,000,” says Byrne. Above that amount, anything is distributed in line with the will/laws of intestacy.
“This simplifies the process hugely, as it doesn’t have to go to probate, and can be distributed immediately to the person so nominated,” says Byrne.
With insurance policies, Moran says it’s fine to name someone on your policy, so they can deal with it.
Household folder
It’s not just finances you should be considering however if you’re the person typically charged with household affairs, such as how to get boiler running again when it glitches; what the passwords are to all your streaming accounts; how you turn the water off in your house; what the wifi/Alexa password is; who delivers your broadband/electricity/gas?
Where are birth certs/PPS numbers kept for children?
Leaving details on passwords lying around is problematic, as the whole point is that they are closely guarded for security. So if leaving details on passwords, it might be wise to encrypt them somewhat in a pattern that’s familiar to the person who will take care of them after your death.
Moran says she herself has a password book, which is locked away. Her other half knows where. But of course, these change on a regular basis, which means it needs to be updated.
Depending on the level of detail you want to leave behind – personal passwords etc – you could consider investing in a small safe. You can expect to pay upwards of about €30 for a small safe which would hold some documents, passports etc. Of course, you need to pass on either the key, or the access code, to someone you can trust.
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