Learning to Let Go

I think I am in a unique position to understand the importance of not hoarding things. Over the course of our marriage, we have lost all four of our parents and had to clean out two full houses worth of "stuff". And believe me, these people were hoarders. Not the scary type of hoarders who save mountains of newspapers and stuff, but normal Mom & Pop type hoarders.

It made me sad when I was going through my Mom's house, particularly her craft room, which was crammed to the rafters with unfinished projects, art supplies, and expensive, unread craft books. I kept thinking if she'd spent more of that time and money on doing fun stuff with us instead of all this useless junk, what great memories I would have instead of cussing her while I was wading through all this stuff and trying to sell it for pennies on the dollar at an estate sale.

You need to think long term and realize how this might come to roost on your children. If things go in the normal way, you might have 20, 30, or even 40 years before this becomes an issue, but we all know that this can happen very unexpectedly. My cousin and his wife died suddenly and violently in their mid-30's and left behind 3 orphaned children. Things like that happen sometimes, and if something terrible like that happens, do you want your children to have to deal with your whole house full of junk, in addition to all the other traumatic stuff they would have to deal with?

Cleaning out a house after a death is a terrible thing. It's exhausting, both physically and emotionally, it's heartbreaking, it's frustrating and annoying, and it's just about the least fun thing you can imagine doing. My in-laws were very clean people and not pack rats (so we thought) but we had a big eye opener when we started digging into the drawers and closets and all the little hidden areas of the house - ugh! They had saved every pay stub, every birthday card, every paid bill, and 20 years worth of bank statements - what a mess. And because we were out of state, we had three days to do the whole house. I've never worked so hard in my entire life and my kids and husband did too. Everyone hated me by the end of the week, but we got most of it done and the neighbors and people from Goodwill had to deal with the rest of it.

So take a minute a go around your house and put yourself in your kid's shoes and imagine them having to deal with your house if something happened to you. Then take some action and get rid of some of that stuff.

On another note - do you have a will and a trust? Yes, I can see your eyes rolling. I can see that guilty look on your face. This is something you HAVE TO DO! Yes, I am yelling. As I said, we have lost 4 parents and not one of them had a really proper will set up and it cost us THOUSANDS of dollars - real serious actual dollars that we could have used to buy cars, pay for college, or put towards retirement and instead it was just wasted on lawyers, court fees, and other unnecessary expenses. I think most people have no idea at all about what happens to your property after you die. Let's look at two scenarios:

John and Sally are married and own a house that is in both of their names. They have two kids and no will. John suddenly has a heart attack and dies. In this scenario, Sally would have no access to any money other than what she can grab out of their checking account or what she might have stashed in her name. She can't sell the house, his vehicle, or any personal belongings of his until it is cleared by the court, which may take months and will require very high cost legal representation. Our lawyer cost us $38,000 for a simple transfer of property. If you can't come up with that kind of money (and who can these days?), you are going to be stuck with a property that you can't easily sell and will still have to make payments on and maintain.

If the estate is large enough to require probate, the state will automatically take 10-18% right off the top. Chew on that for a minute. Sally will most likely be awarded custody of the children, but if some relative decides to kick up a fuss and paint a bad picture of her, that could even be a chancy thing and they could end up placed with another relative or even in foster care. And in the meantime, Sally is grieving, trying to figure out how she is going to support her family, dealing with insurance companies, and lawyers, and real estate agents, maybe for the first time ever and she is going to be tearing her hair out and downing tranquilizers just to keep her sanity.

Now here is the second scenario. Same circumstances, but John and Sally had a properly written will and have a simple trust set up with their house and all their major property in it. The house, vehicles, and all other property passes smoothly and automatically to Sally and all she has to do is show the death certificate to the proper parties and have John's name removed from the assets. She can mortgage them or start selling them the day after the funeral if she so chooses with no questions asked, no lawyers needed, and a minimum of taxes to be paid. Custody of the children is prearranged with backup plans set in place as needed if both couples were to die or become incapacitated.

Which scenario would you choose? I know which one we would. About a month after my father-in-law passed and we saw what a heck of a mess we were in for with his estate, we found a good estate lawyer for our own estate. We didn't have to go far, we found one right at the end of our street. We sat down with him for about 2 hours, answered some questions, made some decisions, and paid him about $1,000, which was without a doubt the best money we've ever spent! Then in less than a week, we had a will for each of us, a trust, power of attorney forms, guardianship forms and everything needed for every possible combination of catastrophes that could befall our family.

That's more than I usually share in a public blog about my finances, but this is something I feel so strongly about. As an adult, you have a duty to put your business in order to protect your family - you just have to. You need life insurance, wills, backup custody plans, the whole enchilada. 'Cuz I've been on the receiving end of a situation like this and I'll tell you, it ain't a pretty picture and it is easily the most stressful period of my life and I'm not about to put my kids through all that and I hope you won't either.