Are You Worth More Dead Than Alive?

Sapphire Wealth Advisory Group > Blog > Insurance > Are You Worth More Dead Than Alive?

You may not be worth more dead than alive, even with a will.

 I am sure growing up someone has heard a spouse say to the other, “my husband/wife can’t wait till I kick the bucket because they know I am worth more dead than alive”. When we figure the money one makes, investments they have accumulated, and the presumed life insurance policies they have in force through work and privately, the beneficiaries may receive a windfall of cash. On the surface, this may appear to be a lot of money.

Now, let’s assume there were some additional key items that were not implemented in conjunction with saving and investing, and purchasing the life insurance policy to protect their family. Namely, they did not have a will, trusts for the children or grandchildren, a long-term care policy in the event of needing extra care at home or at a nursing facility, a healthcare proxy, or even a power-of-attorney (“POA”). Even more so, in the event that a catastrophic event occurred, and these documents were not in place to provide guidance who would know how to carry out the wishes of their loved one? Would one think they would still worth a lot when they pass away?

When we get older addressing your estate plan may become a depressing and daunting topic. It is at that moment, next to buying life insurance, you are facing the reality of your mortality. Some of the discussions one may have with their spouse, children, and advisors are things such as, where they want to be buried, how their assets should be transferred and to whom they should go to, or who will take care of their young children. In the event they are in a vegetative state, what their medical wishes are, and how they should be implemented. When I have helped clients discuss these matters with their attorneys and tax advisors, I may suggest having a social worker present. They provide emotional support in these discussions.

The legal documentation and jargon can be very technical. Many times, lawyers may request certain information, and clients may not understand what the questions or legal items being completed or what the implications behind them are.

Important Legal Items:

  • Will – A legal document in which you, the testator, declare who will manage your estate after you die.1
  • Trust – A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries.2
  • Long Term Care – Long-term care involves a variety of services designed to meet a person’s health or personal care needs during a short or long period of time. These services help people live as independently and safely as possible when they can no longer perform everyday activities on their own.3
  • Healthcare Proxy – A health care proxy is a document that names someone you trust as your proxy, or agent, to express your wishes and make health care decisions for you if you are unable to speak for yourself.4
  • Power of Attorney (“POA”) – Power of attorney is granted to an “attorney-in-fact” or “agent” to give that individual the legal authority to make decisions for an incapacitated “principal.”5
  • Guardianship – A guardianship is a legal relationship created when a person or institution named in a will or assigned by the court to take care of minor children or incompetent adults.6

These documents provide a landscape of step-by-step instructions on what to do in any given situation. The benefit of this is to ensure that a family may work together and harmoniously when carrying the wishes of their loved ones. However, in the unfortunate circumstances where these documents have not been established, the ripple effect it causes can become challenging to overcome or irreversible.

I have experienced situations, personally and professionally with clients, that the beneficiaries lost out on their future inheritance due in fact by the “poor planning” of the grandparents or parents. One situation was when a client’s mother developed a chronic disease in which she needed extra help at home. Although going to a nursing home was an option, they were adamant about staying home with an aid. While I have been working with this client for a short while, it became apparent that some of the assets my client was anticipating being passed down were at risk as a result of having to pay for a 24-hour health aid. Over time, although my client had POA over her mother’s finances, she saw her accounts diminish quickly as a result of paying for home care.

This is a relatively simple example which I believe many people could relate to. While it might be difficult to predict the future, it is best recommended to establish a suitable action plan that will address what to do in certain situations so that the family will not experience the burden nor pay exorbitant fees to address them themselves.

Although it will be emotionally challenging to take action, and follow through with one’s wishes, the outcome would be a lot smoother than guessing or assuming. In its basic form insurance is the vehicle used to protect someone from some sort of loss. When you combine this element of protection with a written document of how you wish to be cared for when you are not able to speak or have passed away, typically can be the difference between leaving a legacy or mess.


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Registered representative of and securities offered through Hornor, Townsend & Kent, Inc. (HTK), Registered Investment Advisor, member FINRA/SIPC, 600 Dresher Road, Horsham, PA 19044, (215) 957-7300. HTK does not accept time-sensitive or action-oriented messages delivered via e-mail, including authorization to “buy” or “sell” a security or instructions to conduct any other financial transaction. 2371022PH_Feb21


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