Preparedness Provides Peace of Mind

An important lesson learned during the pandemic

It’s been about two years since the terms pandemic, social distancing, mask-up, and coronavirus (just to name a few) have become part of our daily vernacular.  As a society we have learned about patience and resilience; as family members we have learned how to stay in touch from afar; as businesspeople we have learned how to effectively and efficiently work remotely; but above all else we have learned that unfortunately anything can happen at any time.  The best safe guard against uncertainty is being prepared – something we at First Long Island Investors have been talking to clients about for nearly 40 years, especially when it comes to their financial well-being.

Many of our recent conversations have centered around stories of people who became ill with COVID, and while most of the stories have happy endings, some do not.  As a wealth manager and trusted advisor to our clients, we have heard anecdotes of how the surviving partner or family member was overwhelmed trying to understand the family finances, including locating and accounting for all of the assets.  The pandemic has reminded us that it is important to ensure that everything is in order in the event that whomever serves as the family’s CFO cannot fulfill that role, even if only temporarily.

Let’s start with the basics – do you have a current health care proxy, a power of attorney, and a will?  These are documents that everyone should have, and they should reflect your current wishes.  If you do not, a reputable trust and estates attorney can help you obtain and/or update these and ensure they meet your needs.

Next, do you have a list of all of your banking accounts and investments as well as the information for how to access each (advisor contact info or web site)? This list would serve as a way for your family to easily locate your assets and should include bank accounts, brokerage accounts (taxable and retirement), partnership interests, private investments, pension plan, employee/executive compensation, life insurance, etc.  When was the last time you reviewed your beneficiaries?  Every brokerage account and pension plan allows you to designate a beneficiary.  You probably completed the form when you first opened the account, but it is also likely that your life has changed since then. If you got married, had children, got divorced, or became widowed you should review your designations and make sure they are as you intend.

Good financial preparedness can put your mind at ease all while serving as a way for you to review your current long-term asset plan.   We recommend that all investors have an asset plan which includes an appropriate cash buffer. A plan that can endure the unexpected, such as a pandemic.   As a best practice, we recommend reviewing your financial assets annually and making any necessary updates.  Life changes and your finances need to change with it, but your confidence and peace of mind never needs to change.

 

• Philip W. Malakoff, Executive Managing Director at First Long Island Investors, LLC, a Long-Island based wealth management firm providing sound financial guidance for nearly 40 years.