How a Balance Transfer Check Works

If you’re struggling with debt, you’ve probably considered a balance transfer before. While the more popular way to go about actually transferring your balance from a high-interest credit card over to your zero or low-interest one usually just requires a quick five minutes to do so online or a call to a customer service rep, there is one other way the transfer can be done — via a balance transfer check.

If you go the balance transfer check route, you’ll be receiving the check directly from your credit card company in order to withdraw cash from your credit line. Once you have the check in hand, you’ll have a couple options:

  1. You could make the check payable directly to the company which holds your debt, or
  2. You can make the check payable to yourself in order to get a cash deposit.

In the second scenario, the only real difference is that you’ll be paying your debt off directly from funds transferred from your new balance card into your checking account rather than putting the debt onto the new card to pay off that way.

Still confused? Consider an example. Let’s say you owe $3,000 to a furniture store that you used to furnish your new pad, and you’d like to pay that debt off using a zero interest credit card. In order to go the balance transfer check route, you would simply apply for and open a new card, get a balance transfer check worth $3,000 from your new card made payable to yourself, and deposit it into your bank account. Once the money has cleared, you can pay off your debt to the store free-and-clear while paying off your balance transfer check debt on your new card in installments that don’t accrue interest for however long your introductory period lasts.

Of course there are positives and negatives that come with using a balance transfer check. For starters, not every company will even offer this option, and you’ll need to be sure to read through all the terms and conditions before deciding to use it. Sometimes these transactions take time, and most balance transfer deals come with strict deadlines in order to actually qualify for the zero interest, so you’ll need to watch out for that.

For more on the balance transfer check and whether it’s the right option for you, check out this piece.

The post How a Balance Transfer Check Works appeared first on MagnifyMoney.

How a Balance Transfer Check Works

If you’re struggling with debt, you’ve probably considered a balance transfer before. While the more popular way to go about actually transferring your balance from a high-interest credit card over to your zero or low-interest one usually just requires a quick five minutes to do so online or a call to a customer service rep, there is one other way the transfer can be done — via a balance transfer check.

If you go the balance transfer check route, you’ll be receiving the check directly from your credit card company in order to withdraw cash from your credit line. Once you have the check in hand, you’ll have a couple options:

  1. You could make the check payable directly to the company which holds your debt, or
  2. You can make the check payable to yourself in order to get a cash deposit.

In the second scenario, the only real difference is that you’ll be paying your debt off directly from funds transferred from your new balance card into your checking account rather than putting the debt onto the new card to pay off that way.

Still confused? Consider an example. Let’s say you owe $3,000 to a furniture store that you used to furnish your new pad, and you’d like to pay that debt off using a zero interest credit card. In order to go the balance transfer check route, you would simply apply for and open a new card, get a balance transfer check worth $3,000 from your new card made payable to yourself, and deposit it into your bank account. Once the money has cleared, you can pay off your debt to the store free-and-clear while paying off your balance transfer check debt on your new card in installments that don’t accrue interest for however long your introductory period lasts.

Of course there are positives and negatives that come with using a balance transfer check. For starters, not every company will even offer this option, and you’ll need to be sure to read through all the terms and conditions before deciding to use it. Sometimes these transactions take time, and most balance transfer deals come with strict deadlines in order to actually qualify for the zero interest, so you’ll need to watch out for that.

For more on the balance transfer check and whether it’s the right option for you, check out this piece.

The post How a Balance Transfer Check Works appeared first on MagnifyMoney.

Do I Need to Shred My Old Credit Cards?

shred_credit_cards

Chances are you’re probably already shredding documents like your bank and credit card statements before discarding them. You might even be taking the extra step of shredding things like credit card applications and other pieces of mail you receive since they contain personal information, such as your address. But are you shredding old credit cards when you get a replacement card?

If you aren’t, you probably should.

“With the proliferation of data breaches, phishing scams and ID theft, consumers should do everything possible to protect themselves and minimize risk,” said Thomas Nitzsche, media relations manager for ClearPoint Credit Counseling Solutions.

And that includes your old credit cards (it’s even a good idea for card accounts you’ve closed). That’s because the two most important components of preventing identity theft and unauthorized charges on your accounts are one, securing your sensitive information, and two, reviewing your financial statements regularly.

“Not completely destroying a credit card puts you at risk for ‘dumpster divers’ retrieving your card information and using it fraudulently,” Nitzsche said. “The best way to securely dispose of an old credit card is to shred it and place it in a secure locked recycling bin — such as a locked workplace data destruction service bin.”

Of course, your credit card protects you from fraudulent charges, but you still have to report those suspect charges within a reasonable timeframe. Law dictates that you’re only liable for up to $50 of unauthorized activity, no matter when you report it. And if your card wasn’t present in the unauthorized transaction, you have zero liability. Still, even if you’re regularly checking your statements, it can be easy to overlook small amounts charged over a long period of time. This form of unauthorized use is known as “cramming.”

“Most credit card issuers will only go back and remove the charges for a certain number of months, so it is important to be vigilant,” Nitzsche said.

With all the capabilities credit card thieves have, it’s unrealistic to expect you can prevent theft. Beyond shredding your credit cards, you’ll want to take other precautions, like using secure payment websites, never storing payment information in your web browser and only enabling NFC or RFID payment at the moment of a transaction. Beyond that, you’ll have to watch out for signs of credit card fraud.

You can check your account activity routinely — even daily — or set up transactional monitoring with your bank or credit card issuer. You’ll also want to check your credit scores for sudden changes (it could be a sign someone ran up your credit card balance without your permission) and review your free annual credit reports at AnnualCreditReport.com for other kinds of fraud that can be trickier to detect, like identity theft. To get updates on your credit standing, you can see two of your free credit scores, updated monthly, on Credit.com.

Image: mapodile

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The ‘Leftover’ Cars You Can Buy for Less This Year

car-for-less

Labor Day weekend has long been a big week for car sales, but according to Edmunds.com, you may be able to save really big if you look into leftovers — that is, outgoing 2016 models scheduled to be phased out or redesigned for 2017.

Per the car shopping site, dealers will be looking to get rid of these vehicles at steep discounts (think thousands of dollars) as they try to clear out their lots to make room for shiny, new 2017 models. And you don’t need to feel too behind the times for buying a car that’s last year’s news.

“Even though these vehicles are being redesigned or going away altogether, they still have the same great technology and performance that you’d find in most new cars, but at a much better value,” Ron Montoya, senior consumer advice editor for Edmunds.com, said in a press release. “Bargain hunters are strongly encouraged to consider these vehicles.”

Edmunds identified nine vehicles in particular that are going at a good price relative to their MSRP, based off of the Price Promise deals listed on its site. Note: Some of the discounts are regional, so it’s still a good idea to comparison shop for car deals in your area. And it’s best to avoid buying a car outside of your budget just because you can get a good discount.

With that in mind, here are the five most lucrative leftover vehicles.

1. 2016 Mercedes-Benz E-Class Sedan

Edmunds spotted a number of deals for $7,000 to $10,000 off the soon-to-redesigned luxury sedan’s $71,175 MSRP.

2. 2016 Hyundai Genesis Sedan

Up for rebranding as the Genesis G80, this sedan is going for $3,000 to $5,500 less than its $49,800 MSRP in certain areas.

3. 2016 Buick LaCrosse

Edmunds is seeing deals for as much as $6,200 off the $38,982 MSRP on the entry-level full-size sedan getting a redesign in 2017.

4. 2016 Cadillac SRX

The luxury SUV is going for $8,000 off its $56,380 MSRP, once the incentives are factored in. It’s being replaced by the 2017 Cadillac XT5.

5. 2016 Subaru Impreza Sedan

Scheduled for a 2017 redesign, the 2016 Impreza is going for $900 to $1,100 less than its $22,052 MSRP. But, according to Edmunds, San Franciscans can get the real deal — saving as much as $2,300.

Looking to Buy This Labor Day?

Of course, it can pay to do your research and comparison shop before hitting a dealership, no matter what area you’re in or what car you’re looking to buy. It’s a good idea to think about your monthly payments versus price, so you know exactly what the car is going to cost you over the life of the loan — and you don’t overextend yourself.

Also, it can help to check your credit, since a good score will help you qualify for the best financing opportunities and save you on interest. You can do so by pulling your credit reports for free each year at AnnualCreditReport.com and viewing your credit scores for free each month at Credit.com.

Image: Ridofranz

The post The ‘Leftover’ Cars You Can Buy for Less This Year appeared first on Credit.com.

What Happens to Your Credit Score When You Buy a House?

credit-score-after-purchasing-a-home

If you’ve just bought a new home, chances are you spent quite some time worrying about your credit score. After all, your credit score affects your ability to get a mortgage, and the interest rate you’ll pay on that mortgage.

But what happens to your credit score after you’ve purchased a home? That’s a complicated question with a complicated answer.

Credit Inquiries Cost Some Points

You’ll likely start seeing minor dings in your credit score as soon as you begin applying for mortgages. When you apply for pre-approval, lenders will pull your credit score. When the lenders do perform a hard credit pull, it tells the credit scoring algorithm you’re looking for new credit, which will cause a small drop in your credit score.

You can limit this effect while mortgage shopping by applying for pre-approval with several companies within a two-week period. Some credit scoring models will give you a longer period than this, but keep it to two weeks to be safe. When you limit your mortgage shopping to a short time period, you’ll still get a ding on your credit score, but it will be smaller. (You can view two of your credit scores for free by signing up for an account on Credit.com.)

New Credit Costs Even More

Applying for mortgages will ding your credit a bit, but actually opening a mortgage will cost even more points, especially if this is your first home loanmortgage. The large increase in overall debt will definitely cause a drop in your credit score.

Luckily, installment debts like a mortgage cause less of a score decrease than high-balance revolving debts like credit cards. Still, though, you’ll likely find that your score drops by a few points once the credit bureaus pick up your new mortgage account.

But Adding to Your Credit Mix Is Good

If you’ve never had a mortgage before, adding one to your credit profile can ultimately be a good thing. Approximately 10% of your credit score is made up of your overall credit mix. The more variety, the better!

Once your credit score gets past the temporary ding from the inquiries and taking out a new account, it may actually increase because you’ve expanded your credit mix.

And Making On-Time Payments Is Even Better

Ultimately, if you make your mortgage payments on time, you should see a fairly quick increase in your credit score. In fact, within a few months, barring any other issues, your credit score will likely be higher than it was before you first applied for a mortgage.

When you buy a home, it’s important to be prepared for your credit score to temporarily drop. This happens any time you pick up a new credit account. But once you get past the initial drop, financially responsible homeownership will likely increase your credit score more than ever before.

Image: Justin Horrocks

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4 Companies That Help You Get Your Paycheck Early

Financial emergencies have a habit at cropping up at the worst possible time — when you’re stuck in-between paychecks. Perhaps you need $250 for an emergency car repair, but you just paid rent and won’t have the funds until your next payday in two weeks. Normally, you might want to turn to a credit card or a payday loan, racking up onerous fees in the process.

What if you could get a portion of your next paycheck early without paying hefty fees or interest?

That’s the premise behind the following four services. They try to help workers make ends meet without taking on debt by giving them access to the money they earn when they earn it.

Activehours

  • Available if you have direct deposit.
  • Withdraw up to $100 each day and $500 per pay period.
  • No fees or interest.

ActivehoursWhat it is: Activehours is an app-based service available on Android and iPhone smartphones. Once you download the app and create an account, you connect your bank account and verify your paycheck schedule. You must have direct deposit set up and linked to a checking account.

How it works: In order to use Activehours, you need to upload your timesheet, either manually or by connecting a time-tracking account to the app (your employer must use one of the eligible timesheet partners in order for this to work). Using this information, Activehours estimates your average take-home hourly rate after taxes and deductions.

As you work, the hours will be automatically shared with Activehours, or you may have to upload your timesheet. You can then cash out a portion of your earned pay before payday.

You can withdraw up to $100 each day. Based on your account balances and Activehours use, the pay-period maximum could increase up to $500. The payment will arrive in your checking account within a few seconds, or within one business day, depending on where you bank.

Activehours doesn’t connect to your employer’s payroll. It connects to whatever bank account you use to collect your pay. The next time your paycheck hits your bank account, Activehours will automatically withdraw what you owe. There aren’t any fees or interest charges for using the service, however Activehours does ask for support in the form of tips.

DailyPay

  • Works with popular ride-share and delivery services.
  • Get paid daily for your fares or deliveries.
  • There’s no interest. You pay a flat fee that is subtracted from the day’s earnings.

dailypayWhat it is: DailyPay caters to workers who are employed by ride-share or delivery services, such as Uber, Postmates, Instacart, Fasten, and DoorDash. It can also be used by workers at restaurants that use delivery apps, such as GrubHub, Seamless, or Caviar.

How it works: After signing up for DailyPay, you’ll need to connect a bank account where DailyPay can send you payments. Next, you’ll need to connect your DailyPay account with the system your employer uses to track your hours. DailyPay tracks the activity within the accounts and sends you a single payment with the day’s earnings, minus a fee. Restaurant workers get paid for the previous day’s delivery earnings, minus a fee, from all the connected delivery programs.

About those fees…

Fees are based on how much you ear per day. As a driver or on-demand worker, when you make less than $150 during a day you’ll pay a $0.99 fee. For workers who earn more than $150 in a day, the fee is $1.49. Restaurant workers’ fees vary based on order volume, but are often around $2.49 for each payday. In either case, you’ll need to update your account with each service and redirect the payments to go to DailyPay.

PayActiv

  • Employer must sign up and offer PayActiv as a benefit.
  • You can withdraw up to $500 in earned income before payday.
  • $5 fee for each pay period when you use the service.

PayActivLogo-200PayActiv is an employer-sponsored program that allows employees to withdraw a portion of their earned wages before payday. While you can’t sign up on your own, you can ask PayActiv to contact your employer about offering the service. There’s no setup or operating costs for employers.

Once your employer offers PayActiv, you sign up and withdraw money as soon as you earn it. You can withdraw up to $500 early during each pay period via an electronic transfer or withdrawal from a PayActiv ATM (available at some employers’ offices).

The early payment comes from PayActiv, but it isn’t a loan and you won’t need to pay interest. Instead, your employer will automatically send PayActiv an equivalent amount from your next paycheck.

There is $5 fee per pay period when you use the service, although some employers cover a portion of the fee, according to Safwan Shah, PayActive’s founder. As a member, you’ll also get free access to bill payment services and savings and budgeting tools.

FlexWage

  • Employer must sign up and offer FlexWage as a benefit.
  • You’ll receive a reloadable debit card tied to an FDIC-insured account where your employer deposits your pay. You can add earned pay to your account before payday.
  • No fees for employees.

Flex WageFlexWage is an employer-sponsored program that relies on the use of a payroll debit card and integrates with employers’ payroll systems. If your employer offers FlexWage, you can get your paycheck deposited into an FDIC-insured account with the linked Visa or MasterCard debit card. You can also add earned, but unpaid, wages to your account before payday without paying any fees.

With FlexWage, the employer determines how often you can make early withdrawals and the maximum amount you can withdraw. Unlike PayActiv, FlexWage doesn’t act as a middle-man. Your paycheck advances will come directly from your employer’s account.

Bottom Line

These four companies work slightly differently, but they share the same basic premise: giving you early access to the money you earned, without saddling you with a painful assortment of fees. If you’ve had to rely on borrowing money in the past when funds are tight, these could be a better alternative to credit cards or payday loans.

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A Divorced Dad’s Guide to Keeping Lawyer’s Bills Low

divorce-lawyers

Hey you, Mr. Middle-Aged Man sitting in the third row wearing the Titleist hat and regretting not putting on the sunscreen yesterday while you were spraying golf balls all over your local municipal golf course. I’ve seen that look before. Hell, I wore it for months myself. You’re getting divorced and the ensuing custody battle has drained your checking account quicker than a cracked pipe at SeaWorld. Sit back and take it from someone who lived through it first-hand — representation is costly.

It’s often the first question people think about when considering a divorce – how much will it cost? Some attorneys don’t schedule a lunch appointment without finding someone to bill for it. To them, your best interest only comes in the form of currency. Understandably, attorneys expect payment for their services, but, in my own divorce experience, how much you’re willing to pay can dictate your “best” interest. Sob stories can just get you voicemail next time you call to schedule a meeting.

I can only speak from the perspective of a divorcing dad doing all he can to get 50/50 custody (which can be very difficult when courts are involved and you are male), but here are my tips for handling your divorce without losing an arm and a leg paying attorney fees.

1. Accept That Your Attorney & Your Ex’s Attorney May Be Friends

Attorneys generally have a “professional” respect among each other. They may talk bad about the opposing attorney to your face, but there is a good chance after a little digging around on the internet you are going to see any two attorneys hobnobbing at some bar association banquet.

2. Limit the Phone Calls

Whether your attorney is friendly with opposing counsel or not, it’s still a good idea to give your attorney ZERO reason to contact the other attorney unnecessarily. Remember, your attorney will likely bill you for that 20-minute phone call.

3. Email Only When Absolutely Necessary

Speaking of it, unless you catch your ex holding your child hostage in a war zone, limit email communications, even with your own attorney. Instead, keep notes and send a weekly or even monthly summary. Emailing your attorney every time you get a bright idea can to cost you $20-$30 a pop. I don’t care if you are laying out a defense strategy that will be taught at the Harvard Law Review or telling your attorney “Thank You” for doing their job. Flattery may get you nowhere but further in debt. (Been there, done that and have the T-shirt to prove it!) And hunt around the internet. There are many third-party apps that will keeps track of all the crucial information for you at a fraction of the cost of having your attorney do this for you (or even for free).

4. Understand All the Costs of Mediation Before Agreeing to It

Depending on the laws in your state or country, mediation can get pretty pricey. In my experience, mediation is the gift that keeps on giving for attorneys. You will likely wind up paying your attorney their hourly rate PLUS half the cost of the mediator (usually another attorney). I advocate taking your chances in court — again you are dealing with two people that make more money the longer you sit in mediation. Take it from me and the millions of other guys I suspect spent a fortune getting the same exact thing they would have going in front of the bench.

5. Know That Talking to Your Ex Through the Lawyer Can Cost You

If your divorce is about as amicable as an Israeli-Palestine peace agreement, you can bet your lawyer is eventually going to suggest/demand that any communication with your soon-to-be ex go through them. But, remember pal, ANY communications with your lawyer can cost money, so try to tune out potential arguments with your ex and, even if you are in the right about an issue, just document it and maybe it will pay off in the long run. (Remember, too, the urge to call your ex every nasty name in the book may be tempting, but in today’s digital age screen images of emails and text messages are hard to explain away, so refrain from sending profanities your ex’s way.)

I stress again do not get caught in the trap of communicating with the ex through a lawyer. Fellow dad, I get it. I’ve been there and I’ve got the scars to prove it. This new world of going through a divorce involves calculated moves and you can forget common sense.

6. Accept That Custody Is Going to Be a Costly Battle

If you are just dealing with a divorce with no kids, congratulations, you have saved yourself a few thousand dollars immediately. Unfortunately, for many of us, that isn’t the case. You can kick, scream, write a daily letter to the editor of your local newspaper and you still may not wind up with, at the minimum, 50/50 custody. The family law system does not tend to favor a father and your lawyer likely knows this. I’m not saying accept less custody than you are seeking (I didn’t), but be prepared for many empty meetings with your attorney telling you to take the deal you are offered. Good luck is my advice, again I’m not telling you to punt, but be forewarned. Unless your pockets are very deep, this could potentially come up fruitless.

[Editor’s Note: Remember, divorce can wreak havoc on your finances and your credit. You can monitor any joint accounts as you go through the process by pulling your credit reports for free each year and viewing your free credit report summary, updated each month, on Credit.com.]

 This story is an Op/Ed contribution to Credit.com and does not necessarily represent the views of the company or its partners.

Image: PeopleImages

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7 Ways to Save at Wegmans

save_at_wegmans

Several years ago, while driving through upstate New York, we stopped at a grocery store my friend from the area absolutely raved about. I had never heard of Wegmans and was a little surprised we were stopping there because it was lunchtime.

Little did I know what was in store for me!

In the years since, and after a Wegmans opened near my home in Maryland, I’ve come to appreciate how well they run and how it’s a pleasure to shop there.

If you’re a fan and looking to save money at Wegmans, here are my best tips.

1. Coupon Doubling Up to 99 Cents

Wegmans has some of the most competitive prices, but did you know they will also double coupons with a face value up to 99 cents? There are a few rules to keep in mind, such as the doubling or face value of the coupon cannot exceed retail price and you can only use four manufacturer’s coupons on four of the same product per day.

If the coupon’s face value is $1.00 or more, it will be redeemed at face value (no doubling).

2. Join the Shoppers Club!

Wegmans has a Shoppers Club, like many other stores, but not only do you get discounts in the store, you’ll be sent mailers that often include more coupons. You will also receive the Wegmans Menu Magazine which often has great recipes and other fun educational articles.

3. Use the Wegmans App

The Wegmans App is a rich-featured shopping-list app that integrates nicely with your local store. You can create your shopping list at home and it will give you your total, pulling prices from the store. This can be very helpful if you’re on a tight budget and help you plan your trip better.

In the store, there are signs throughout that, when scanned with the Wegmans app, reveal videos, recipes, and product information. The app also gives you access to the Wegmans Menu magazine and can pull recipe ingredients from the recipes.

If you have a favorite money saving app, you may want to stick with it. If you don’t and go to Wegmans often, consider using theirs.

4. Create a Shopping List Online

If you don’t have a smartphone, or don’t want another app, you can always create your shopping list on the Wegmans website. Afterwards, you can print it out and see exactly how much the trip will cost you.

The list will organize ingredients based on the store’s aisles, which can save you a ton of time in the store.

5. Consider Wegmans Brand

Most stores’ generic brands are mediocre but not Wegmans – some of their products rival the brand names in quality. Nearly every category of product, from frozen pizza to sauces and packaged baked goods, has a Wegmans brand and they’re usually good and well-priced. At my local Wegmans in Maryland, a 29 oz. can of tomato sauce will cost you just $0.79 versus big brand name tomato sauce priced at $1.69.

6. Don’t Miss the Hot Food

Most grocery store hot food bars can be depressing affairs of overcooked food that’s overpriced. Wegmans has an impressive food bar with nearly every kind of food imaginable, but where they really shine is in two areas — sushi and the burger bar.

The sushi is delicious, fresh, and well-priced, especially if you compare it with a sushi restaurant. If you don’t see what you like, you can make special requests and they are happy to make a roll or package you want. The burger bar is a full-fledged restaurant and they offer a variety of great burgers and sandwiches that are also well-priced.

7. Personal Shopping

If you are short on time, Wegmans offer “personal shopping” where they will get everything on your shopping list and deliver it to your car. You need to place the order online the day before but you pay for it without ever having to leave your car. It costs just $5.95 with no minimum order. It’s not available at every store though, sadly. It is available only in three locations – the flagship store in Pittsford, New York, and the stores in Bridgewater and Cherry Hill, New Jersey.

Finally, if you live in a state where grocery stores can sell beer and wine, give their bargain wines a shot (just remember to drink responsibly). At just a few bucks a bottle, what do you have to lose?

[Editor’s Note: You can monitor your financial goals, like building a good credit score, each month on Credit.com.]

Image: Willowpix

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How to Have ‘The Talk’ With Your Family About Your Will

discussing-estate-planning

Most people never disclose the details of their estate plan to their children, who may also be their successor trustees, executors, and agents. As a result, after they die, the children are left to guess about their deceased family member’s true intentions because of the sterile, legal language used in their parent’s will or living trust.

It’s also true that many children are not even sure that their deceased parent wrote a will, much less know where it is located, and in fact, there are countless stories of children who were unable to find Mom or Dad’s will. Furthermore, even if a parent’s will, or trust document, can be located, there is a good chance that some of its provisions will be out-of-date and that it was based on the status of the family at the time it was written but not necessarily as it is today.

Too often, therefore, after a parent dies, there is a lot misunderstanding and conflict among the deceased’s surviving children because they are left to try to decipher the final wishes of their parent based on long-ago conversations, cryptic notes, family traditions, false assumptions and their own perceptions about what is fair. This can be a recipe for disaster.

To avoid leaving such a legacy to your children, it’s a good idea to have a family meeting, which could be held at your home or at your lawyer’s office. You may want to ask your key advisers to attend the meeting too. The tone of the meeting should be somewhat formal but friendly as well. After all, you aren’t dead yet!

Here are some of the topics I recommend discussing at your family meeting:

  • The legal documents in your estate plan (Trust, Will, Power of Attorney, Health Care Directive, etc.) and the purpose of each.
  • Where these documents are stored and how your family can access them quickly after your death or disability.
  • The responsibilities of the executors, successor trustees, personal representatives, and agents charged with administering your estate and the steps that must be taken to complete the administration process. During this discussion, be sure to assure your family members that they have the right to know what is going on during each stage of this process and explain to those who will serve as your agents that they have a responsibility to keep everyone informed throughout the process.
  • The purpose and responsibilities of your professional advisers.
  • If desired, why you made the decisions you did in your estate plan. For instance, why you designated one child as your agent instead of another and why you named your agents in a certain order or instructed them to work as a team.
  • How your assets, such as a 401K, will be distributed and protected for future generations.
  • Why certain “difficult” assets may need to be handled in a special way, like your home, family business or one-of-a-kind family heirlooms.
  • Why you’ve put one child’s inheritance in a trust rather than leaving it to him or her outright in your will, and why your decision to do so is wise and loving rather than arbitrary.

By the way, most parents do not address the size or composition of their estate during a family meeting because they typically like to keep that information confidential, even when they are talking with their children.

You can also use your family meeting to:

  • Build and strengthen ties within your family and build relationships between your key advisers and your children.
  • Convey your family values to younger generations.
  • Answer questions so that everyone feels comfortable with your estate plan and how you arrived at your decisions.

Some parents worry that talking with their children about their estate plan will create conflicts and hurt feelings. But that’s exactly what may happen if you leave behind a plan that your children know nothing about, and as a result it’s possible that one of more of them may try to undermine the plan after your death.

Educating them now can help your children understand the rationale behind your estate planning decisions and that they are purposeful, carefully considered and based on good counsel. Also, if any conflicts or misunderstandings related to your plan do arise, you will have an opportunity to try to resolve them. And finally, you’ll be able to change your plan if you want based on your children’s comments and reactions to it.

Image: PeopleImages

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