Tuesday, October 26, 2010

(Updated) Living a Good Life with a Graceful Exit

Out of the mouth of another babe: “My son and I were in the car the other day and some news story about inheritances came on the radio. I mentioned that he shouldn't hold his breath - we weren't planning to leave anything. He responded that he didn't get the idea of inheritances because if you have money to leave, you either didn't live your life right or you didn't give enough to charity.”

How do you know if you’ve lived a good life? Picture yourself at the end of your life, like at your eulogy, and basically ask yourself:

· What do I want my family to remember about me?

· What do I want my friends and co-workers to say about me?

· What do I want to have accomplished?

· What do I leave behind?

· Did I live a full life, doing what I wanted to do?

· Was I happy, and did I have fun?

The great thing about this is, you're not there yet. Now you can make this eulogy into whatever you want. It's not all about money, but it all ties in. Planning and making goals is key to getting anywhere. Clarifying your goals, writing them down, and working toward them in your life everyday is rewarding in itself.

If you don't run your life, your life will continue to go on; you just may not get the results you want if you don't specifically plan to get those results.

Case in point (from the mailbag): “My father died in Sept and we are still trying to settle the estate, my father was GROSSLY IN DEBT.

For what it's worth:

1) ALL debts that are owned by the deceased are placed into an account...If the other spouse is still alive, they become responsible for the debt.

2) Any and all possessions currently on the estate can be used to cover the debt of the estate if funds are insufficient to cover the debt.

3) If you accept ANY OBJECT (BELONGING) be it piano, baseball cards, a vehicle--the creditors may attempt to collect those objects to sell/auction to cover all the debt of the estate, or they can and most often bill you for the estimated cost of the object to gain losses.”

This, of course, is a matter subject to state laws, and they vary from state to state.

Not only did this man NOT make a graceful exit, but he mired his family in his mess too. He may have been happy, had fun, and did what he wanted to, but it was at the expense of his family and every credit-worthy person in the country.

He who dies with the most toys DOES NOT win! He inevitably leaves casualties. Who wants to be remembered for having all the toys, yet leaving his family with the burden of "stuff" disposal and debt from beyond the grave?

UPDATE: My own father-in-law died and left unpaid debts that STILL bother me even though we settled his estate some years ago. For some reason, this man was also a "die with the most toys" person who INSISTED on having a brand spanking new motor home (one of the "big boys" worth about $100k), even though he couldn't afford the home he already lived in. They say when senility sets in, the first symptom is irrational money behavior, and this definitely qualified.

When I first heard of the new toy purchase, I yelled and yelled about how this motor home cost twice as much and has 1/3 the square footage of their current home, but it fell on deaf ears. I asked how they paid for it, and the answer was a home refinancing--not just a refinance of the principal, but a TOTAL refinance! Twenty years of house payments had been thrown out the window for the sake of a toy.

They got to own that toy for maybe four years before both in-laws died (he went last). Guess who got stuck with the bill? We didn't--we did a voluntary default, and turned it back into the dealer to save the estate (such as it was). The dealer then auctioned it off, leaving about $15k short of the balance owed. The taxpayers picked up the tab for that through the dealer bad debt write-off--WE didn't have that much to spend on Dad's toys! Besides, what would WE do with a monster motor home?

Then there was the house they left behind, piled high with STUFF. One room was nothing but empty boxes, another was stuffed with electronics that may or may not have worked, and another was stuffed with office furniture stacked on top of one another. The garage was stuffed with bags of old useless documents and receipts--some dating back to the 60's. Another symptom of mental decline is hoarding, and I'd say we had it here.

After a summer-long episode of "Dig Out the House", the equity built up in it was used to do necessary-but-delayed repairs (like the roof) and selling fix-ups (like replacing a burned counter top), so in the end, it was all for naught.

You can't take it with you (whatever "it" is), so you may as well make sure "it" has a new home before you go--or better yet, don't accumulate it in the FIRST place! Don't leave a legacy of insecurity and foolishness for your family to have to sort through and figure out how to shut down.


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