If you are looking for a New Year’s Resolution, consider putting together a life book that contains all your important information and documents to help you get your finances in order.
Set time aside to sort out your vital documents this December so that you start the new year off on the right financial footing. A life book is a place where you store all your important documents. This should include things like:
- Your latest bank statements and tax records
- Retirement documentation
- Investment policies
- All your short-term insurance policies
- Risk policies and long-term insurance policies
- Your updated Last Will and Testament
- Birth certificates
- Medical details
This can be done by keeping hard copies of these documents in a file or by putting them online. There are websites that will store the information for you or you can save the documents on your computer. Websites like My Lifetime Tracker provide personal and business record-keeping templates which will guide you to collect, copy and share your vital information.
However you decide to store your vital information, what is most important is that someone you trust knows where to find it. If you have a physical folder, let your family know where you keep it. If you store the documents on a website or on your computer, they need to know the passwords and login details. Your financial adviser should also have records of all your investments and insurance policies, which means your family needs to have your adviser’s details as well.
Once you’ve created your life book, make sure you update it each year with any new investments, policies and medical details – also use the opportunity to review your will. As part of the annual exercise, update your personal information with your product provider – have you changed addresses or other contact details for example?
In addition to filing the actual documents, it is also useful to create a spreadsheet with all your investments, bank accounts and risk cover, including product providers and account numbers, so that there is a single piece of paper that reflects your total assets, liabilities (debt) and policies. Not only does this make things easier for your family, but it also makes your life easier as you have a single document that records all your financial information rather than having to page through a folder each time you need the information. In undertaking this exercise, it is not uncommon for people to discover policies or investments they have forgotten about. What more motivation do you need to start that life book?!
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