What would happen if suddenly you were incapacitated and unable to take care of the finances? Would someone else know where to start? And more importantly, how can you make it as easy as possible for that person?
I don’t know about you, but a number of my bills are paid online. I need to keep that login information somewhere for my person to be able to open the account and pay the bills for me. Personally, I like to use a password app on my phone and computer, so for me, one option is to make sure that my person has the password to get into that app.
Another easy option is to keep a list of the websites and passwords on a piece of paper in a safe. Of course, this requires you to update the list every time a password changes, but it’s a pretty easy and low-tech way to handle this sort of thing.
(And as an aside, if you don’t have some sort of a safe in your house, why not? I highly recommend a locked firebox to keep important papers. Not only does it keep your important documents safe, but it’s also easy to grab everything in one place if you have to leave your home in an emergency.)
Tracking Option One – Detailed List
But what about the bills? How is someone supposed to know when to pay the bills?
One easy option is to use some sort of budgeting program or keep a spreadsheet of your bills. This way, someone who you designate can come in and take a look at the bills and say “Okay, they paid this bill every month, I should look for that bill,” or “Hey, it looks like the homeowners insurance was due this month, but I haven’t seen that bill come in yet.”
This, of course, also has the added benefit of helping you keep track of where your money is going and places where you can cut back.
Tracking Option Two – Simple List
We all have bills that we pay monthly, quarterly, bi-annually, and yearly. Sit down and make a quick list of what bills get paid when.
Monthly: Gas, electric, mortgage, lawn care
Quarterly: Water, trash
Bi-annually: Car insurance, property tax
Yearly: Home insurance
This is, obviously, not a complete list of my bills, but you should be able to put together a list of your expenses without too much trouble. Put that in a safe place and make sure your person knows how to handle those bills.
No one likes emergency planning
No one wants to think about what might happen if they’re in a position to be unable to pay their bills for a week or a month or even forever. But I have always found that if you plan ahead, it seems like you’re that much less likely to need those preparations. Have everything in place and rest comfortably knowing that you’ve done all you can.
Megan is a 30-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.