How I 'Found' $300,000 for an Elderly Relative
Hours of sorting through documents and tracking down accounts led to an unexpected discovery. If you have elderly relatives, you should consider doing the same thing I did.
![Detail of a one hundred dollar bill through a magnifying glass.](https://cdn.mos.cms.futurecdn.net/emTxJpCubEsKe6YATnmMvg-415-80.jpg)
On my family’s annual pilgrimage to the Northeast in late June, I took two days to help a 94-year-old relative get her financial house in order. I didn’t find any money buried under a mattress, but I did find some hidden in places most people don’t look – but they probably should.
I knew she had updated her will after recently moving to a new state, but I was not certain what else she realigned. So, when I began digging through recent tax documents, I made two startling discoveries. First, it turns out she has $300,000 in a bank stock that our family thought was only worth a few thousand dollars. And, second, we found cash from a life insurance policy paid out more than 20 years ago.
After getting over the initial shock of these findings, we went about piecing together the rest of her financial puzzle. Over a 48-hour period, however, I turned up more of what I expected: lots of missing or outdated information. But after a lot of tedious, time-consuming work, all key documents have been located and every cent she owns is accounted for.
![https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-200-80.png](https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-320-80.png)
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Lots of Gen Xers and Baby Boomers with older relatives may need to go through a similar exercise in the coming years. For those of you in this situation, here are some guidelines to reconstruct your loved one’s financial house:
Collect Key Financial Documents
Ask your loved one to gather copies of the following documents:
- Will, Revocable Trust and Financial Power of Attorney;
- Bank, brokerage account and Social Security;
- Cost basis of all investments;
- Website log-in credentials for any financial assets (if available);
- Estimate of monthly living expenses;
- List of all beneficiaries for Individual Retirements Accounts, including names, dates of birth and addresses;
- Statements for life insurance policies and annuities;
- A list of any other assets and debts, such as house, car and jewelry.
- Most recent tax returns.
Recent Tax Returns are Critical
As you begin collecting documents, the most important one to help uncover current assets, and a great starting point for your detective work, is the tax return. It can help nail down what assets your loved one owns, as well as the income they have coming in from pensions, annuities, real estate investments, business interests and Social Security. This is like having the answer key to a pop quiz!
Schedule B Is Key
This document is filed to report the interest and dividends received each tax year and led to the discovery of the $300,000 in bank stock. I noticed on the most recent Schedule B that my relative was receiving $5,000 in dividends from this stock. If you can’t find any paper statements or log-in information to financial websites for your loved one to track down each asset, start by asking the tax preparer for a copy of the 1099 form for each asset so you will know which company to contact.
Once you have a full list of assets, debts and current statements, including all insurance policies and the tax return, set them aside in a large envelope marked “Important Documents – Tax and Financial.” If you refresh this package once a year, it should take less than one hour to maintain.
Make Certain Key Documents are Signed
These include current copies of a will, financial power of attorney, health care power of attorney and any trust documents. In going through my relative’s legal papers, I found pages 1 and 8 of her will, but the rest were missing. After a long search, we found the missing pages and stapled them together.
She also had several unsigned copies of her health care power of attorney document, so I set those aside. Once we had all of the current legal documents signed, I compiled them into one envelope marked “Important Legal Documents.” A copy of the Social Security card, birth and marriage certificates can be placed in here, too. This envelope only needs to be refreshed each time an update is made to the will or other legal paperwork.
Make Copies for Advisers and Others
Finally, provide copies and access to files to people who serve as professional advisers, such as attorneys, accountants, financial planners and insurance agents. In addition, share contents of your envelope with your relative’s executor, financial and health care agent, and/or another relative who lives nearby.
If There is Complexity or a Lot of Questions, Hire a Financial Adviser
My relative wanted a fresh start in her new hometown, and she has enough moving parts to her finances that we met with a local Certified Financial Planner professional I vetted in advance of the meeting. One reason this meeting was so productive was we brought the organized envelopes with us, and they could give us timely advice.
Spending a few hours preplanning and getting organized now can save hours of time-consuming searches and expenses when your loved one is no longer here. And you never know, it can also bring nice surprises — like the ones I found — that will benefit your family’s future generations.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
Lisa Brown, CFP®, CIMA®, is author of "Girl Talk, Money Talk, The Smart Girl's Guide to Money After College” and “Girl Talk, Money Talk II, Financially Fit and Fabulous in Your 40s and 50s". She is the Practice Area Leader for corporate professionals and executives at wealth management firm CI Brightworth in Atlanta. Advising busy corporate executives on their finances for nearly 20 years has been her passion inside the office. Outside the office she's an avid runner, cyclist and supporter of charitable causes focused on homeless children and their families.
-
Stock Market Today: Dow Outperforms After IBM Earnings
Investors also parsed a strong reading on second-quarter GDP and a dismal decline in durable goods.
By Karee Venema Published
-
Try the 6 to 1 Grocery Shopping Method to Save Time and Money
The 6 to 1 Grocery Method can help you save money, reduce waste and eat healthier.
By Erin Bendig Published
-
If You're the Millionaire Next Door, You May Be a Terrible Spender
Good job on all that great saving. Now you need to start spending some of that hard-earned retirement savings on the things you love.
By Joe F. Schmitz Jr., CFP®, ChFC® Published
-
Who Will Be the Beneficiaries of Your Wealth?
Deciding who you want to inherit your wealth, as well as when and how, is a crucial first step in estate planning. Here are the four beneficiaries to keep in mind.
By Adam Frank Published
-
Confused by Annuities? Making Sense of the Different Types
Many investors aren't sure if annuities are a good option for meeting financial goals. Let's look at the different categories, along with their pros and cons.
By Kris Maksimovich, AIF®, CRPC®, CPFA®, CRC® Published
-
Talkin' 'Bout My Generational Wealth: Baby Boomers
With retirement, each generation has different priorities and challenges. For Baby Boomers, it's a matter of ready or not, here it comes.
By Alvina Lo Published
-
How to Avoid a Big Hassle if Your Financed Car Gets Wrecked
How an insurance check is made out for repairs can cause a world of problems if the lienholder is left out.
By H. Dennis Beaver, Esq. Published
-
Estate Planning Strategies to Consider as Election Nears
Are big changes in tax laws coming soon? Not likely, but you might want to take advantage of higher estate and gift tax exemptions well before the end of 2025.
By David Handler, J.D. Published
-
How to Get Your Money's Worth From Your Financial Adviser
A good financial adviser will focus on how your financial planning and investment strategy align with your lifestyle and aspirations.
By Pam Krueger Published
-
Think of Prenups and Postnups as Financial Planning Tools
These contracts provide a clear framework for asset management and protection and are especially useful if you get married later in life.
By Andrew Hatherley, CDFA®, CRPC® Published