If you died suddenly, would your partner know where your will and insurance policy are, where you bank and where your investments are? What about more mundane things like who services the furnace in your home and who your plumber is?
In a recent newsletter, I asked readers if they have answered the ‘what happens to my family if I die suddenly’ question. My aim was to help people feel more in control of their lives by having a will and term life insurance. A former lawyer and current reader of this newsletter responded with some additional thoughts I want to share.
He said wills and insurance are important, but so is making sure your partner and/or family members can find the information they need to manage your affairs and your household. To summarize this information, he created what he calls the ‘I’m Not Gonna Die, But …’ list.
Here’s a link to the list. Readers are invited to open it in Google docs and add any additional points. Your input will make the list more comprehensive and useful.
Categories on the list include legal, finance, house-related and technology. What you won’t find is space for passwords to bank and investment accounts or streaming services. I suggest you share these separately with your spouse and trusted family members only using a password manager.
If you’re the person in a relationship who doesn’t handle most or all of the financial matters, invite your partner to collaborate on an ‘I’m not gonna die, but..’ list. You’ll help yourself feel more secure, you’ll be doing that former lawyer a favour as well. “I’ve been trying for ages to get this advice out there,” he told me by e-mail. “It’s a mess for people when spouses/parents die.”
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Rob’s personal finance reading list
Smarter driving can cut gas bills by 20 per cent
Remember hyper-miling? When gasoline prices spiked higher in 2008, there was a lot of talk about how to squeeze fuel consumption as low as possible when driving. Now, prices are rising even more dramatically as a result of war in Ukraine. Here’s a CAA expert on how to cut your driving costs by as much as 20 per cent by modifying your driving habits. Now for some surprising thoughts on how transportation costs have become a big factor in retirement planning. This is a U.S.-focused article, but it’s an eye-opener for everyone.
Introducing the all-weather portfolio
A recent weekend roundup on the My Own Advisor blog included some links to stories about the idea of an all-weather portfolio that provides a higher level of diversification than conventional portfolios. The idea is to own a mix of investments that can handle inflationary and deflationary times, as well as bull and bear markets.
So what exactly attracts people to cryptocurrencies?
This question is asked in light of the huge price swings in crypto. The answer from experts is hope for a huge gain.
Nuts to spoiled food
Tips like these seem to resonate more when grocery prices are soaring. Eleven items, nuts included, that will spoil if kept in your pantry rather than the fridge or freezer.
Q&A
Q: When the pandemic hit, I recognized the need to build up a healthy emergency fund, so I diligently saved until I reached $30,000. The amount sits in a regular savings account with a modest interest rate. Meanwhile, contribution room in my TFSA account remains large enough that an injection of $30,000 would bring it close to its max. Sometimes I think it’s absurd for me not to shift the $30,000 over to my TFSA because I can always withdraw it tax-free should an emergency arise. Am I ridiculous to keep the $30,000 in a savings account instead of investing it in my TFSA?
A: Ideally, you’d fill your TFSA with growth investments like stocks. That’s a better way to take advantage of the tax sheltering of a TFSA than holding a savings account paying a very low interest rate. But if there’s no immediate prospect to invest that remaining TFSA in stocks or equity funds, then adding your savings does make sense. Say you earn 1.25 per cent on your savings, which these days is a top rate. That’s $375 in interest earned tax-free in your TFSA.
Do you have a question for me? Send it my way. Sorry I can't answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
A “spot the fraud” quiz from the B.C. Securities Commission.
The Money-Free Zone
My Back Pages has to be one of the most-covered Bob Dylan songs. Here’s my favourite version, by Marshall Crenshaw. Simple and direct, with a great guitar sound.
Tweet of the week
Gas pump humour directed at someone who put $10 worth of gas in a vehicle.
In case you missed these Globe and Mail personal finance-related stories
- Dark side of the housing boom: In the Maritimes, rent inflation is biting hard
- How to use TFSAs effectively to maximize investment returns
- How will Canadian mortgage rates react to Putin’s war, nuclear threats and oil shock?
More Rob Carrick and money coverage
Subscribe to Stress Test on Apple podcasts or Spotify. For more money stories, follow me on Instagram and Twitter, and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.
Even more coverage from Rob Carrick:
- 🎧 Catch up on Stress Test: Are your parents giving you money? • Why it’s time to stop shaming the renting lifestyle • Is now the right time to buy a house? • Why are young Canadians leaving the cities they love? • Eating in: How COVID has shifted our food spending • Crisis-proof your finances? • Can you afford to live downtown? • The cost of kids
- ✔️ The housing file: The housing boom is ripping apart the financial fabric of Canada • Shut out: A well-qualified millennial home seeker throws up his hands after losing multiple bidding wars • Big city housing affordability is over – now what? • She sold her Toronto house to retire somewhere cheaper, but it didn’t work • How young adults and the whole country win with a tougher mortgage stress test for home buyers • Can’t afford your house? It’s likely not your fault
- 📈 Investing: Robo-advisers have grown out of the novelty stage. Here’s help in finding one right for you • The 2021 ETF Buyer’s Guide: Best Canadian equity funds • The 2021 Globe and Mail online brokerage ranking: Who’s best for investing … and answering the phone • Are these the stock market returns of a lifetime? • On the cusp of retirement and wondering about an ETF that pushes the limits on aggressiveness
- 💰 Your money: The five most important numbers for checking the health of your personal finances • Today’s freakishly low mortgage rates can’t last. What will pandemic home buyers do when they rise? • There’s a cost in money, isolation and family stress when seniors choose to remain in their own private homes • Taking CPP early can cost you $100,000 and limit your long term options • Fleeing the city for the suburbs? Watch out for higher property taxes, more cars and other costs
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.
