What if you got sick? What if you got very sick? What if you got so sick that you were in hospital for many weeks? Who would make sure the household bills got paid? With the global covid-19 pandemic, these are questions we need to ask.
In a couple, there’s usually one person who manages the budget and pays the bills, but what if that person got sick – would the other know what to do? Or maybe you’ve come down with covid-19 and you’re a single parent – who looks after the children? Perhaps you live on your own – does someone else know how to manage your finances if you became very unwell?
Have you decided on a guardian to look after your children if you are unable to do so yourself? Do you have a nominated person to manage your finances when you’re too sick?
Although these are uncomfortable scenarios to consider, they are all situations that with prior planning could make a major difference to the outcome.
Budget and Bills
My husband and I make all our financial decisions together, yet once those decisions are made – I’m the one who manages the budget and pays the bills. This works well for us, but it got me thinking…what if I got really sick (and it’s been on my mind as I work as a school teacher) would the hubby even know how to find the bills.
I imagine these concerns are even more acute for front-line workers.
At home we talk about our budget, but just because the budget layout makes sense to me as I deal with it often, doesn’t mean it will make sense to him. Even though I could verbally go over the details multiple times – in the stress of the moment would he remember?
That’s why I’ve been going through our budget and writing extra notes. Hopefully, the hubby will never need to read these notes but there are no guarantees in life.
Nearly all our bills arrive in my email, some reminders are even sent to my phone. What if my lovely other half didn’t even know the bills were there? I hate to think that the gas could get cut off in winter because the bill wasn’t paid.
We’ve since discussed setting up a family email address, just for the bills.
Organising our financial details is done by keeping a Barefoot Investor styled ‘Fearless Folder’ of all our details including passwords in a lock box. We both have a key to this box in the event either of us needs to know all our financial details. This includes our email addresses and passwords. Although, I think it will make more sense to have a family email address.
Thankfully, neither of us are secretive about our phones, and we both know how to unlock and use the other’s phone.
Bank Accounts, Bonds and Shares
Included in our Fearless Folder are all our bank account details, including jointly owned and individual accounts.
Even though our financial decisions are combined decisions, we both have our own accounts for our Splurge money to do whatever we want with. We use the Barefoot Investor method of managing our money.
The banking details in the Fearless Folder also contain individual client numbers, account name, BSB and account numbers, as well as passwords.
Our young children have investment bonds and we own shares. Everything is documented to make life easier if one of us where to become very ill, be in a major accident, or as much as no-one wants to think about – pass away.
We also have a designated adult aged child with access to these documents, in case myself and my husband are both unable to manage the household finances or care for our younger children.
Car and House Insurance
No one wants to think about car and house insurance during times of major stress, but this could be when you need those details most.
Stress, distractions and emotional driving may lead to an increase in road accidents.
According to Brake, a UK road safety charity “71% [of drivers] had lost concentration at the wheel in the past year due to stress or annoyance. The most common reason for this was the behaviour of other road users (60%), followed by stress about personal issues (44%) and work-related stress (39%).”
Ensure you know what insurance you have, who it’s with, what’s covered and how to contact your insurer. Again, these are details we don’t want to think about, yet need to know.
These are all details that are suitable to keep in a Fearless Folder.
Superannuation and Life Insurance Policies
In the event of the unthinkable, does your partner (or nominated person) know how to locate your superannuation and life insurance policies?
Oddly, life insurance is also sometimes called death insurance. Unless you’ve opted out or your super balance is too low, most superannuation policies include this insurance.
Life/death insurance may include a funeral expenses payout. Does yours? If you’re not sure look up your superannuation funds PDS (product disclosure statement) or give them a phone call to find out.
Have you made a binding death nomination through your superannuation to ensure your money goes where you want it to go.
Now is a good time to put together all your financial details into one document and make sure your partner or nominated person knows where to find them.
Here’s the Barefoot Investor example of what you could include in your Fearless Folder.
At the very least, ensure your loved ones know the household budget, how to locate the bills, your banking details and insurance policies.
It’s uncomfortable to consider getting covid-19 and having to think about what would happen if you got very sick, or even worse. Yet, having your financial details organised will give you and your loved ones a little comfort during a stressful time.
What method do you use to ensure a nominated person knows your financial details in the event of serious illness or death? Please comment below.