Plan for the unexpected

An illness, a riptide, a slippery road — anything could take us suddenly from our families.

When a family breadwinner passes away, a family often must grieve in the midst of financial upheaval. Lost income needs to be replaced, savings need to be withdrawn, and the surviving family’s financial habits may need to change entirely, in order to manage new circumstances. Deeper questions may come into play about guardianship and the long-term financial care of the surviving children.

We can’t predict what might happen to us. What we can do is put measures in place that protect our families, especially our dependents, from the financial stress and confusion that would follow if we were to suddenly pass away.

Create a will. A will allows you to appoint a guardian for your children and their property, as well as an executor, who will settle the estate you leave behind. A will also gives you the means to hand down your property as you choose.

The choice of a guardian for your children and their estate is one of the most important decisions you can make. If you don’t have a will, the courts make that decision for you. You can save your surviving family from a great deal of uncertainty and difficulty if you have, well in advance, arranged for a guardian who understands his or her responsibilities.

Without a will, the courts also appoint an executor for you, and divide your property according to the law of succession. This could significantly lengthen the time it takes for your family to have your affairs settled, and when all is said and done, the decisions made may not match your preferences. It’s much simpler to make those decisions yourself, far ahead of time, and state them clearly in a will.

Seek legal help as you prepare your will. If you want to start on your own, you can find books and software that guide you through the process, but it’s still a good idea to consult a legal professional as you finalize your will. A lawyer can make sure that your will is complete, that you’ve appointed appropriate guardians and executors, and that you’ve followed the proper procedure to render the will a valid legal document

Get life insurance. A life insurance policy gives you a means to replace the income you provide for your family, if you were to pass away unexpectedly. Talk to your insurance broker or agent about different kinds of life insurance policies available, in order to find the policy that best suits your family’s situation.

Keep your financial files organized and current. When you have a solid financial system in place, you can conduct your personal finances with much more ease and efficiency. This also will simplify things for your surviving spouse or your executor, as he or she closes your accounts, distributes your assets, files your taxes, shuts down your utilities, and pays your creditors.

Keep your will, insurance policies and retirement accounts updated. As your life changes, your beneficiaries and heirs will change. Keep a checklist of accounts that involve beneficiaries, and update those accounts, along with your will, as major events in your life occur.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 19 years experience in retail banking and with financial institutions in Guam and Hawaii. You can email him at


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