Fiscal fitness -- April's theme

As some of you already know, the deadline for filing taxes is fast approaching. It's also my birthday month, so I feel it appropriate to deem this month's fiscal motif "Death and Taxes."

Because you commenters have repeatedly demonstrated that you're smart, savvy and generally well-organized, I'm assuming you've already filed this year's taxes. One of the things I do after filing is begin to set up the system for organizing next year's taxes. This way, when January rolls around and I get my W-2s, grabbing the remainder of the tax info ain't no thang. So here are the questions to answer:

• Do you have someplace online or on your computer where you can easily archive and retrieve any email-based receipts for charitable donations or tax-deductible expenses?
• Do you have a physical location where you can store all the receipts, billing statements, interest statements, invoices or other papers related to your taxes?
• If you file with someone else, do they know where you're keeping all the tax-related material?
• Do you have a checklist of materials to keep in anticipation of next year's taxes? (Wondering what might go on this checklist? Look here.)
• Have you filed a new W-4 with your employer if you want to adjust your withholding?
• Have you checked with HR to see when you can increase or decrease the amount you're withholding in your 401(k) or 403(b)? Have you marked that date on your calendar and set up an auto-remind in your calendaring program?

See? Easy. I figure you all in the comment will tell me what other questions we should be asking ourselves post-tax time.

And now, let's talk about death. (Cal Naughton, Jr: The darkness is creeping ever closer.) Why not make this month the one in which you make sure that your demise -- or your loved ones -- isn't made even more grievous by unresolved financial messes?

I suggest taking a two-pronged approach. First, figure out what you need to do in order to get your own estate into order. Then, suck it up and talk with your parents, your siblings and your partner about how they'd like their affairs handled after their demise.

In my case, what I did was this:

• Check to make sure my husband's the beneficiary for my retirement accounts. If nothing else, the money will buy him a year or two of maintaining our current standard of living while he runs off and marries some crazy teenaged Vegas stripper wife figures out what to do next.
• Get copies of the life insurance policy my mom has out on me. This will cover my funeral.
• Get my living will witnessed by two other people so there is no nasty, prolonged squabbling in case of a dire medical situation.
• Write up my preferences for what's to be done with my remains, and what funeral service touches I would like. I know that Phil wants to have "I'll be glad when you're dead, you rascal you" played at his service. I want "Lucinda Matlock" recited at mine, and then everyone can decamp for a great meal courtesy of my estate.
• Write up who gets what in terms of any family heirlooms or possessions that don't belong to our joint household.
• Write down all my accounts and passwords for Phil. This way, he can handle disposing of my digital debris.

What I still need to do: copy these preferences, notarize the copies, and send them to my mom and brother in addition to keeping a copy in-house.

After my dad died, my mom and I took the opportunity to establish her preferences in re: her estate, and we revisited the matter shortly before she married. Here's what we did:

• Established who was my mom's executor and what that entailed in the state of Virginia.
• Reviewed what assets she had, where she kept the documentation and which banks she did business with.
• Established a physical location for all bank statements, safe deposit box keys and other documentation.
• Had an exquisitely awkward conversation regarding who would get what after she died.
• Discussed burial preferences and services.

Honestly, talking about how to handle someone's estate isn't nearly so awkward as discussing how they want to handle things like assisted living and end-of-life care. So, you know, look at it that way. It's an icebreaker!

In my case, it helped that for about a year and a half after Dad died, my mom was so irked by the reams of paperwork and tag ends from wrapping up his estate that she vowed, Scarlett O'Hara-style, that with God as her witness, she'd leave an orderly estate.

If you have a parent who's deep in denial over their eventual mortality, perhaps starting off the conversation with "I love you, and this is not meant to be ghoulish at all ..." might work? Or maybe just stick to finding articles on Marketwatch or the WSJ and forwarding them all, "Food for thought! Swear I'm not a ghoul!"

(Because this post is already epic-length, I'll leave the recommended reading -- and forwarding material -- to a later time ...)

So this month, lay down the foundation for tax year 2008, then get your final wishes in order. This way, if you get hit by a car, all your mom has to worry about is whether or not you're wearing clean underwear, not whether or not you'd rise from the coffin in fury if someone busts out with "All By Myself."

Comments

[Kerry]

Taxes--I am filing mine today, which is the latest I've ever done them. I consider myself exceptional in that unlike my parents I do not get extensions and I do have the folder system so that I put all my tax related stuff in one place as it rolls in. I'm a little changeling.

As for death, oh shit, I need to get my ex off my accounts as beneficiary.

My dad died in 10/06 and my grandmother in 6/07, so like Lisa's mom, mine is sick of people dying with loose ends and has hers all organized. I know my middle sister is her medical proxy person, but other than that the head is in the sand a little on where everything is. She's going to retire and move this year though.

[Lady M]

I print out all email or web based charitable receipts as soon as I receive them and put them in next year's tax folder. I also make photocopies of things like property tax bills and DMV registration renewals (for the VLF refund) when I pay them and file them too. It's much nicer than having to search the following spring.

My husband and I have simple wills, but we really need to get a lawyer to do a living trust (if that's still the correct term) this year.

[Siobhan]

I bumped up my withholding after filing this year another $100 a month. As our mortgage interest goes down, I really don't want to get nailed owing. I really, REALLY like that refund we get.

[Cori]

Any email receipts for donations get labeled "Charity" and archived in gmail.

[Stephanie]

I haven't actually filed yet even though I did my first Turbo Tax run in early February. I put it off because last year is the first time I had ever exercised and sold stock options and I'm still not convinced I have everything entered correctly.

I do have a place where I dump anything tax related through the year. It's nice to have it all in one place when I do sit down to file the things.

Putting together my "If I die" folder/binder/whatever has been on my to do list forever. So I'm glad that is April's theme.

[Maria]

I love gmail, I email myself copies of all sorts of random info that I or Bill may need in the event of a catastrophe, and label it accordingly. Bill has the passwords for the most important online stuff, the rest are stored in gmail. All our financial/insurance type info is backed up at his office, since he is/works for a financial advisor.
For some reason my dad has always been uncomfortable discussing his and my mom's personal finances with me or my brother. (My mother, on the other hand, gave me the passcodes for all their accounts when I was 17.) But since Bill and I married, he has been slowly relaying more info to Bill about this kind of stuff. I guess it's less emotionally charged subject with an in-law, plus it's what Bill does.