MONEY Estate Planning

Military Families: Does the Government Owe You a Bunch of Money?

father in military holding baby
Ariel Skelley—Getty Images

Surviving spouses or children of deceased military members could be owed benefits.

After a veteran dies, he or she technically no longer has a claim to disability benefits. However, there are certain circumstances in which a widow, widower or surviving child may be entitled to accrued benefits — or money — from the Department of Veterans Affairs (VA). If you’re not sure whether you’re eligible, it’s worth looking into.

If you’re a surviving spouse or child, here are the circumstances in which you would be eligible to file for benefits:

1. There was a disability claim pending at the time of the veteran’s death. If the VA failed in its duty to assist the veteran in developing the claim, an accrued benefits claim should be filed. For example: The VA failed to send out a letter requesting medical evidence to support the veteran’s claim.

2. A previously denied claim had new medical evidence in the VA claims file before the veteran died. For example, let’s say the VA did not “rate” the veteran’s medical report. The rating is a formal legal document that is used to assess the claim and contains the following: the benefit being claimed, the evidence in support of the claim, the decision (either a grant or denial), and the reasons and bases justifying the decision. You have one year after the date of notice of a grant or denial of the claim to file an appeal – or, a notice of disagreement. In that time, the claim is still considered pending.

3. A claim of clear and unmistakable error (CUE) was pending at the time of the veteran’s death. For example, the veteran may claim the VA made an error in the decision to deny benefits. Specifically, he or she may contend that VA overlooked an important medical report.

4. A veteran’s appeal on a denied disability claim was pending at death. In this case, you may be eligible for those benefits.

5. The claim must be filed within one year after the veteran died. A claim sent to the Social Security Administration for survivor benefits for the widow or veteran’s children is also considered a claim for VA survivor benefits.

A VA disability rating prepared prior to the veteran’s death can be used, but only for accrued purposes. In other words, the rating decision is necessary to establish the veteran’s rate of benefits for the month of death for payment to the surviving spouse.

To apply for accrued benefits, a surviving spouse should file VA Form 21-534 [(Application for Dependency and Indemnity Compensation, Death Pension and Accrued Benefits by a Surviving Spouse or Child (Including Death Compensation if Applicable)]. If the only benefit claimed is an accrued amount, VA Form 21-601, Application for Accrued Amounts Due a Deceased Beneficiary, may be used.

Just because a veteran dies, the claim does not necessarily die with them. A veteran’s beneficiary should file a VA Form 21-534 or VA Form 21-601 to make a determination of accrued benefits. It costs you nothing to see if you are entitled to any money.

If you feel the VA denied your claim unfairly, you should file what is called a notice of disagreement. This is the first stage of the appeals process. From here, you can go it alone, or ask a service representative (with the American Legion, the Disabled American Veterans Charity, etc.) to assist you with the paperwork.

More from Credit.com

This article originally appeared on Credit.com.

MONEY Ask the Expert

How to Pick an Appraiser to Value Your Heirlooms or Collectibles

Ask the Expert - Family Finance illustration
Robert A. Di Ieso, Jr.

Q: “I inherited quite a large stamp collection. I am sure there are a few valuable ones in there, but aside from quitting my job to spend eight hours a day sorting through them one at a time, what are my options for getting it appraised?” — Russell, Melbourne, Fla.

A: The key thing you need to beware of when seeking out an expert to value an heirloom is conflict of interest: You don’t want the person evaluating your property to have an active interest in purchasing it.

So rather than simply walking into any antique shop or auction house and asking for an appraisal, instead hire a certified appraiser. You’re more likely to get a fair judgement from such an individual because it’s a violation of his or her professional ethics to offer to buy an item he has been hired to appraise.

You can find a certified appraiser in your area specializing in stamps—or any other type of collectible, antique or valuable—via the websites of the three major appraiser organizations: International Society of Appraisers, American Society of Appraisers, or Appraiser Association of America. Each member’s profile should list his or her certification level and background in appraising property similar to yours.

Appraisers might charge a flat fee or an hourly rate starting at $150, says Cindy Charleston-Rosenberg, president of the International Society of Appraisers. (You should avoid those who charge a fee based on a percentage of the item’s value.) Depending on location and the level of expertise your property requires, the total bill may be $400 or more.

For that fee, you’ll get a written report that includes the object’s value, the procedure used to estimate this, and a full description of the item.

Be aware that an item can have different values for different purposes: For insurance or estate taxes, you need to know its retail value, or what it would cost today to purchase. For selling, you need the fair-market value or what a buyer would pay you.

If your item has a minimal value and doesn’t require a full written appraisal, Charleston-Rosenberg says she and the vast majority of appraisers will tell you its ballpark worth and waive the service fee.

“An honorable appraiser will turn away a project when an object is not worth it,” says Charleston-Rosenberg.

Often by calling an appraisal office, you can get a rough idea of whether to pursue a full consultation. Charleston-Rosenberg says she knows of appraisers who request an emailed image of an heirloom to determine if their services are actually needed.

Because your heirloom is not a single object but a larger collection, however, you will probably need to have an appraiser view the stamps in person.

More from Money 101:

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What if I need more time to file my taxes?

How do you know if it makes sense to itemize?

MONEY Aging

Handling Family Finances When Dad Is Losing His Grip

family of piggy banks
Sean McDermid/Getty Images

When the person in charge of family finances has dementia or Alzheimer's disease, a difficult transition is required.

A client’s daughter told me recently that she was beginning to notice her father having difficulties with memory and comprehension.

I had known that her father’s health had deteriorated somewhat, but he still seemed relatively sharp mentally up until the last conversation I’d had with him, around Christmas time.

The client’s wife has never been very involved in the family finances, and his son lives out of town. The daughter has been playing caretaker for some time. Now it seemed we needed to have a more in-depth conversation with everyone involved regarding family finances, longevity and what happens after the patriarch has passed away or can’t function as financial head of the household.

The loss of a loved one is unbearable, but far worse is losing a loved one to cognitive conditions such as Alzheimer’s disease or dementia. These decisions may cause personality changes. In some cases, a client may become belligerent or paranoid, especially when dealing with financial issues.

It is always preferable to have a client himself or herself acknowledge that something is wrong, but this may not always be the case. For this reason, financial advisers need to have a plan in place to address situations such as this one.

The first step is to get the family involved. Most of the time, the spouse or children will already be aware of the issue.

In this particular case, I could not discuss financial details with the daughter without a financial power of attorney. Fortunately, we were able to schedule a time for father, mother and daughter to meet and discuss family finances.

What if someone refuses to admit that he is losing his mental acuity? We dealt with this a few years back with another client. He was going through a divorce at the time — a process which may have either contributed to, or resulted from, his mental decline. We ended up being a part of an intervention involving the client, his children, his business partner and his pastor. The pastor referred him to a psychiatrist; luckily, the client pursued treatment that helped.

The key to handling many of these situations is having a ready stable of referable professionals in all aspects of life. In addition to the colleagues we deal with on a regular basis, such as lawyers and accountants, it is helpful to have contacts in the arenas of medicine and psychology.

Solid and consistent documentation is a standard in our industry, but it becomes absolutely imperative when dealing with cognitively questionable clients. Keeping communication records protects everyone involved and can go a long way to explaining client actions to family members if they are unaware of the problem.

Things don’t always go so smoothly. In some situations, you must fire the client. We have had to have these tough conversations in the past. It would be nice to say that we are always able to help facilitate a changing of the guard, but many of these personality issues are beyond our control. When cutting ties, it is important to do it with an in-person meeting. We’re honor-bound to do what’s best for the client, but it is also important to protect our practice. If we are unable to make progress, it may be best for clients to find someone who can better help them.

I’m very thankful the daughter came to me, rather than my having to reach out and have what could have been an unpleasant conversation. At this point we have now gathered financial powers of attorney and reviewed updated wills and trusts, coordinating with the family attorney. The mother and daughter are much more aware of the family financial situation and are not nearly as fearful about the future. I expect the daughter will take a more active role in the management of the family’s finances. We want to make sure that everyone involved is aware of, and on board with, the transition.

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Joe Franklin, CFP, is founder and president of Franklin Wealth Management, a registered investment advisory firm in Hixson, Tenn. A 20-year industry veteran, he also writes the Franklin Backstage Pass blog. Franklin Wealth Management provides innovative advice for business-minded professionals, with a focus on intergenerational planning.

MONEY Estate Planning

3 Things We Can Learn From Robin Williams’ Estate Battle

Susan Williams, Robin Williams and Zelda Williams attend the "Happy Feet Two" Los Angeles Premiere at Grauman's Chinese Theatre on November 13, 2011 in Hollywood, California.
Jeffrey Mayer—WireImage Susan Williams, Robin Williams and Zelda Williams attend the "Happy Feet Two" Los Angeles Premiere at Grauman's Chinese Theatre on November 13, 2011 in Hollywood, California.

The actor's loved ones are feuding over his personal items, but you can spare your family the same battle when you move on.

Six months after comedian Robin Williams’ death, his widow and three children find themselves in an all-too-common situation for families dealing with loss: fighting with each other.

What should be a time to grieve and heal instead has erupted into a legal dispute over the actor’s estate. His widow and third wife, Susan Schneider Williams, is fighting with his three children, Zak, Zelda, and Cody Williams, over cherished belongings, including clothing, collectibles, and personal photographs. Both sides want to keep items—such as his bicycles, collections of fossils, graphic novels, and action figures—as personal reminders of the man they loved and his active imagination.

At the time of his death, Williams had an updated will and estate plan, including specific trust agreements, and a prenuptial agreement in place. But even that wasn’t enough to spare his heirs the unpleasantness he no doubt hoped to avoid.

That’s because when we write up our estate plan we tend to focus on the big-ticket items: the house, the bank accounts, the investments. But often it’s the personal mementoes and cherished items that cause the most contention.

Personal possessions usually can’t be distributed equally to more than one heir. You can’t split a painting in thirds the way you can a pot of money. Then too, you’ve got to factor in the emotional attachment, which can make the division process even thornier.

To avoid having your estate end up the subject of family squabbles, follow these steps.

Decide What’s Important

Any piece of nontitled property can become a bone of contention if the item has any sentimental or monetary value. And while you can’t possibly make provisions for every single item you own, try to identify the possessions that mean the most to you and your family legacy and make plans for who inherits them, advises Mark Parthemer, a Palm Beach, Fla., lawyer who specializes in estate planning.

Consider what you hope to accomplish with the bequest. Do you want your exhaustive movie collection to go to a film buff? Are there family heirlooms you want to ensure your child inherit rather than your second wife?

Ask your heirs which items they’d like as well, recommends Marlene Stum, an associate professor at the University of Minnesota who is an expert in the field of families and inheritance. You may be surprised at what actually holds sentimental value and how many family members may covet the same objects.

Devise a Fair System

Focus on connecting the goals you have for your bequests with what’s fair in the context of your family. You don’t have to split everything evenly to be fair, you just need to be thoughtful and consistent about the division process you use, Stum advises. You must also be very clear about who will be involved in the decision-making. “The more complex your family dynamic is, the more ambigious it becomes about who has a say at the table,” Stum says.

For example, consider whether your oldest child gets to pick first, or if gender should play a role. Parthemer likes a rotation system, where each heir draws a random number and selects one item at a time in order. “It helps to have an executive decision maker or final arbiter outside the family to help make tough decisions if two people want the same thing,” he says, “though in that case it may be best to sell the item and have them split the proceeds.”

Here too, invite your potential heirs to share their input about how they think personal items could be evenly divided.

Let Your Wishes Be Known

Once you’ve created your plan, tell your loved ones not just what you’re leaving to whom, but why. “The more transparent you can be about how you reached your decision, the better,” says Stum, who recommends telling your heirs as a group to avoid any he said/she said squabbles. They might not be happy with your decision, but at least they’ll know your desires and understand your motives, making disagreements less likely.

Write down all your wishes, sign and date the list, and attach a copy to your will. In most states you can revise such a document without going to the expense or effort of updating the will itself, says Parthemer. Be sure your will contains a provision explicitly mentioning the list’s existence, otherwise your wishes will not be binding.

You’ll also want to be detailed as possible when describing specific objects on your list to avoid confusion over, say, which painting you’re referring to, says Stum. You could even take a photo of each object and include that with your written list to eliminate such a problem entirely.

For more help in figuring out how to smoothy pass on your personal possessions, visit the website Who Gets Grandma’s Yellow Pie Plate?

MONEY Aging

When Dementia Threatens a Family’s Finances

Grandfather at table of food
Getty Images

One in three adults will suffer from dementia. Here's how to achieve financial security — and a patient's dignity — when that happens.

My client sat across the table telling me about her late husband — first, his diagnosis of dementia, and then, his suicide a few years later.

On the night before he took his own life, she had finally gathered the strength to tell him he needed to turn their finances over to her. Larger than life when he was healthy, he had been a tremendous businessman. But the dementia had robbed him of sound decision-making, and she needed to protect what was left of their shrinking nest egg.

She asked me, “What should I have done?”

In the years since his death, she couldn’t help wondering whether that final financial conversation had been the tipping point in his waning will to live. It wasn’t her fault; she had supported him throughout his illness with an unmatched strength of conviction and marital devotion. It’s pointless to try to judge the effect of a particular conversation, because he had suffered for a decade. The disease had torn through their lives, leaving a series of wreckages: their relationships, his ability to handle even menial tasks, and — perhaps most painful — his self-esteem.

I told my client she had been in a no-win situation. She couldn’t risk her own future welfare by allowing her husband’s disease to squander all they had worked for. She was in her 60s, very healthy, and had a 100-year-old mother whose zest and longevity foretold of my client’s likely need to support herself for another 30-plus years. To protect herself and her husband from risky investments, unwise purchases and even fraud, my client needed to take over the financial reins. But how do you conduct this crucial conversation about control without robbing a dementia patient of his or her already-declining dignity? With the Alzheimer’s Association reporting one in three seniors in the United States contracts Alzheimer’s or dementia, it’s time we start talking about it.

Some advice:

Avoid a crisis. Don’t wait to have one huge conversation. Ideally, you would have a series of talks before anyone is diagnosed with dementia. As part of an overall estate plan, it’s important to discuss all family members’ wishes for the end of their lives and prepare them for the possibility of losing their independence. It may sound trite to say, “One day, Dad, we may take care of you the way you took care of us,” but laying that foundation ahead of time may soften the blow. It’s nice to think that we live on our own until the end, when we quietly pass in our sleep, but that isn’t our current reality. Medical advances have been successful in prolonging our lives, but not at guaranteeing our independence.

Having a big discussion that feels like a dementia patient is the subject of an intervention is stressful for all involved. Save the intervention-type conversations for true emergencies, and recognize the patient needs to feel safe and loved, not confronted.

Understand the backstory. Everyone brings a different money mindset to this conversation. Ask yourself, why is money important to this patient? Is it imperative to provide for the family? Is it a priority to give it away? Open the conversation by affirming the ways the patient has accomplished his financial objectives until this point.

Take into account any major financial experiences that may be coloring this particular conversation. Olivia Mellan, a psychotherapist specializing in money conflict resolution, points out that men and women can have different views of common financial decisions. If a wife wants to open her own bank account, for example, she may simply desire some independence. Her husband, however, may interpret her wishes as a lack of marital commitment. If a dementia patient has had this kind of conflict, structure your discussion to avoid triggering those old memories and feelings.

Pick your battles. Can the patient retain investment control over a $10,000 account? Is there room in the budget for a weekly allowance so he can continue making spending decisions? Both tactics can distract the patient from participating in larger financial decisions.

Steven A. Starnes, an adviser with Savant Capital Management, tells a story about his late grandmother, who passed away from Alzheimer’s. Out shopping with her daughter, she found a relatively expensive necklace she just had to have. The family had created room in the budget for one-time splurges that would bring joy to her remaining years. As long as the purchase didn’t thwart the family’s long-term financial plans, it was okay. So Starnes’ grandmother came home with a new necklace that drew her focus away from the other losses she was experiencing.

Utilize helpful resources. Some financial advisers are a tremendous help in facilitating these conversations. A person’s declining financial abilities are often the first sign of dementia, so advisers are well-positioned to help a family. Just having an outside party to ask the tough questions can ease the pressure. In fact, some advisers, including Starnes, specialize in clients with dementia.

A growing number of professionals specialize in different end-of-life issues. The National Association of Professional Geriatric Care Managers provides information about care management and a directory of professionals who can help clients attain their maximum functional potential

Another source to locate a professional is the Society of Certified Senior Advisors listing of certificants who have demonstrated expertise in a range of core competencies involving the aging process. Among those holding CSA accreditation are financial professionals, caregivers, gerontologists, and clergy.

To help a family prepare for a discussion of changing financial responsibilities, circulate the book Crucial Conversations, by Kerry Patterson. Another great resource is The Other Talk,by Tim Prosch, which specifically addresses end-of-life conversations between aging parents and adult children. Do some research on the best ways to communicate with dementia patients. It’s difficult work, but it is possible to absolve a dementia patient of financial responsibilities while helping him maintain his dignity.

———-

Candice McGarvey, CFP, is the Chief Story Changer of Her Dollars Financial Coaching. By working with women to increase their financial wellness, she brings clients through financial transitions. Via conversations that feel more like a coffee date than a meeting, her process improves a client’s financial strength and peace.

MONEY Estate Planning

Financially Independent Kids in the Age of Entitlement

spoiled rich kids
Getty Images—Getty Images

Some adult children never become financial grown-ups. That presents a danger to themselves and to their parents.

A few years ago, when I was meeting with a couple who were considering retirement, it became clear that the biggest hurdle that stood in their way was the continued dependency of their adult children. Even though the children were well into their forties, they were still consistently asking their parents for money. This was such a persistent issue that this couple had actually withdrawn money from their retirement plans to support their children.

Luckily, there was a pension to augment their retirement savings; otherwise they would have been forced to continue working. Both spouses were not in the best of health, and working well into their seventies did not sit well with them. I strongly encouraged them to delay retirement, wean their children off economic assistance, and save more while they could.

Looking back, they are in a much better position now, because they took these hard but necessary steps. As is often the case, we may risk losing business by giving advice that’s good but unpopular. However, the road less traveled is often better in the long run for our business and our clients.

Whether they are socialites or feel they are entitled to a never-ending string of handouts, some adult children never develop into “economic adults.” I have found over the years that those clients who consistently work to raise their children as independent, productive members of society often teach frugality, gratitude, and individual productivity. Many feel that one of the best ways to ruin their children is by giving them too much without letting them enjoy the fruits of their own labor.

Our clients want to protect their offspring from the dangers of inheriting too much, undisciplined spending, and today’s overly litigious society. Many financially independent adult children do not plan on inheriting any wealth from their parents. When and if they inherit a more substantial sum, they’re better prepared to handle it having been faithful with their own savings. I encourage our clients to take care of themselves, their church, and charities first. The most important things we can leave our children are values and skills that empower them to achieve independently. Paying for education, providing seed money to start a business, or anything encouraging financial responsibility can be beneficial.

Increasingly, we’re advising clients to utilize trusts and family foundations to ensure their wealth is spent most responsibly. These entities provide safeguards for adult children with protections from themselves and those who might be in a position to take advantage of them. My personal family trust and many of our client’s have provisions where children may withdraw funds for education, medical needs, and basic support. Additional funds are available to the extent they can provide for themselves.

How do we protect against future spouses, business partners, or litigious opportunists taking advantage of our adult children? Revocable trusts established today can become irrevocable trusts when one spouse passes away, protecting the survivor from financial vultures. Irrevocable asset protection trusts serve as another vehicle to protect client interests if threats are more immediate. For those donating significant amounts to church or favorite causes, charitable trusts can provide substantial tax savings.

The Spanish have a saying: “Father merchant, son gentleman, grandson beggar.” We in America express the same thought as, “Shirtsleeves to shirtsleeves in three generations.” Only by understanding the root cause of the problem can we work to develop a plan to thwart this common malady.

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Joe Franklin, CFP, is founder and president of Franklin Wealth Management, a registered investment advisory firm in Hixson, Tenn. A 20-year industry veteran, he also writes the Franklin Backstage Pass blog. Franklin Wealth Management provides innovative advice for business-minded professionals, with a focus on intergenerational planning.

MONEY Estate Planning

The Perils of Leaving an IRA to Your Kid

141224_FF_INHERITIRA
Cindy Prins—Getty Images/Flickr RM

People with the best of intentions can make life difficult for their heirs.

Naming a child as the beneficiary to important assets like your IRA may seem like a no-brainer. Unfortunately, doing that can create several problems.

I once worked with a client who left his IRA to his daughter. When he put her on his beneficiary form, he was fairly young and healthy, so he had little concern about his decision.

When he passed away, however, his daughter was only five years old — a minor unable to inherit the account. The father had the intention of leaving his daughter roughly $40,000 to help fund an important expense or investment. Instead, a judge had to step in and appoint a custodian to manage the asset until the child reached legal age. Even though the child will eventually receive these funds, without any specific guidelines set, the young daughter could potentially make a poor investment decision much different from what her father had envisioned.

I see this problem often with single parents who, because they don’t have a spouse who might receive their assets, make their children their direct heirs. While these clients have the best intentions, I have come to realize that they often don’t understand the consequences of their actions: The courts may delay, interfere or misinterpret their true intentions if a beneficiary is a minor.

The first option I offer to those looking to leave assets to a minor is through a Uniform Transfers to Minors Act account. An UTMA account gives the owner — often the parent, though it could be a grandparent or someone else — control over selecting the custodian should the owner pass away before the child reaches the age of majority. Had my client done this, he could have avoided the involvement of the court-appointed custodian. This option, though, may not always be the best solution, since it fails to give the parent control of how the funds will be distributed.

The second option I offer to parents is to name a trust as a beneficiary. This option provides the most control of how the funds are managed and distributed – an option many parents find appealing because it could prevent the child from making a poor investment, incurring a major tax liability, or quickly running through the money.

A trust can also allow or even require distributions to be stretched over the beneficiary’s lifetime, maximizing the tax-deferred or tax-free growth for the greatest duration and overall lifetime payout for the heirs.

Using separate trusts for each child can allow each heir to use his or her own age for calculating required minimum distributions. That can make a significant difference if there is a large age variance between them. For example, let’s say a grandmother passes away and leaves her IRA to two children, ages 53 and 48, and two grandchildren, ages 12 and 2. If she has created a trust for each heir, then they can each use their own age from the IRS’s life expectancy table to calculate their required minimum distributions. If she has failed to do this, they will all be forced to calculate RMDs based on the oldest heir, age 53 – greatly shortening the stretch period of the tax benefits for the young children.

For parents with more than one child who do not want to incur the legal costs of setting up a trust but want to maximize the stretch benefits of their retirement accounts have another option: splitting the IRA into multiple IRA accounts, creating one to be left to each heir. This will not provide the control over the custodian or distribution, but will allow each heir to use his or her own age in calculating the RMDs of an inherited account.

As advisers, it’s our job not only to help our clients prepare for retirement, but also to make sure their money is taken care of after they die. By helping them properly plan for their beneficiaries, advisers can do just that.

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Herb White, CFP, is the founder and president of Life Certain Wealth Strategies, an independent financial and retirement planning firm in Greenwood Village, Colo., dedicated to helping individuals achieve their financial goals for retirement. A certified financial planner with more than 15 years of experience in the financial services industry, White is also life and health insurance licensed. He is a member of the Financial Planning Association and the National Association of Insurance and Financial Advisors.

MONEY Financial Planning

7 Pre-New Year’s Financial Moves That Will Make You Richer in 2015

champagne bottle with $100 bill wrapped around it
iStock

Before you pop the champagne this December 31, get your financial house in order.

Didn’t 2014 just start? At least that’s the way it feels to me. Well, regardless of how things seem, the reality is the year is just about over. But that doesn’t mean you can’t make a big impact on your financial future before the big ball drops in Times Square.

You can still achieve some very important financial goals before Dec. 31.

1. Make a Plan to Get Out of Debt

You may not be able to get out of debt between now and the end of the holiday season but you can set yourself up now so you’ll be debt-free very soon. Of course the first step is to watch your spending over the holidays. Don’t overdo it. That only makes it harder to solve your debt situation.

Next, create a system to eliminate debt by first consolidating and refinancing to the lowest possible interest rate. Once you do that, put all the muscle (and money) you can towards paying off the highest cost debt you have and make the minimum payments towards other credit card balances. As you pay off your most expensive debt continue to keep your debt payments as high as possible towards the next highest-cost debt. Repeat this process until you are debt-free. Believe me it won’t take that long. But you won’t ever be done if you don’t start. Why not begin the process of lowering your cost of credit card debt today? (You can use this free calculator to see how long it will take to pay off your credit card debt. You can also check your credit scores for free to see how your debt is affecting your credit standing.)

2. Track Your Spending

Even if you aren’t in debt, it’s important to know what you spend on average each month. Once you know where the money is going, you can decide if you are spending it as wisely as possible or if you need to make some changes.

Many people think they know how much they spend on average but most of us underestimate our monthly nut by 20-30%. You can use a program, a spreadsheet or simply look at your bank statements and track your total withdrawals for the month. It doesn’t matter how you do it. But if you aren’t tracking your spending, I recommend you start doing so now.

What’s great about starting to track spending before the new year is that you get used to your system and if you use a program or spreadsheet, it will also simplify your tax reporting for next year. This is especially helpful if you do your own taxes.

3. Review Your Estate Plan

Things usually slow down at work during the holidays. That gives you time to get to important items you may have been putting off. Estate planning is one of those items that people often procrastinate on.

I’m not asking you to get your will or trust done by Dec. 31 (although you could). But at the very least do two things:

  1. Educate yourself about the difference between wills and trusts.
  2. Find a good estate planning attorney or legal service and start the process.

My parents completely ignored this topic. When they both died young and unexpectedly, it made it monumentally more painful, difficult and scary for my siblings and I. Don’t take chances. You can and should start taking care of your estate planning now.

4. Review Your Life Insurance

As long as we’re talking about estate planning, we might as well dust off your old life insurance policies and give them the old once over. Some people have outdated and overly expensive life insurance they no longer need. Others walk around woefully under-insured, exposing their loved ones to great risk that is completely avoidable.

Pull out your old policies today. Do you still need those policies? If not, cancel them. If you do need insurance, start comparison shopping to make sure you have the right coverage at the right price.

5. Start Investing

If you’ve been on the fence about investing it’s time to stop thinking and start doing. If you don’t know how to get started, there are plenty of great resources on the Web. You need to understand the basis, of course, but you don’t need a Ph.D. in economics before you leave the starting gate. Once you read up on the basics of investing, be prepared to start slow and learn as you go. You will be fine.

And remember: You don’t need a pile of dough in order to start investing. If you are a DIY investor, there are plenty of good online brokers who will open an account for as little as $500. Can you think of a good reason to wait until next year to start investing? I can’t either. Let’s go.

6. Maximize Your Retirement Contributions

Before year-end, make sure you have maximized allowable contributions to your retirement plan at work. Unless you are in debt, you want to take advantage of employer matching if at all possible. Even if there is no matching program at work, try to maximize your plan contributions. This will give you the benefit of tax deferral and a forced savings plan.

Call your HR department today to find out if you can bump up your retirement plan contributions for the year.

7. Get in Front of Your Finances

You have an amazing opportunity right now. Make sure you are on top of your financial game now, next year and beyond. Take out a calendar right now and schedule when you are going to begin and follow through on the items on this list.

Look at your calendar for the next seven days. When are you going to:

  1. Inquire about refinancing your debt?
  2. Set up your spending tracking system?
  3. Start asking for estate planner referrals?
  4. Review your life insurance?
  5. Set up your investment account?
  6. Call HR and make sure to bump up your retirement contributions to max out for the year?

Taken all together, the list above might seem overwhelming. But if you do one task each day, you can really change your financial life this week. Each task above will take you between 15 minutes to three hours to complete. Are you going to do one item each day this week? How will you feel once you’ve begun? Or are you going to wait until “after the holidays”?

More from Credit.com

This article originally appeared on Credit.com.

MONEY Financial Planning

How Families Can Talk About Money Over Thanksgiving

Family Thanksgiving dinner
Lisa Peardon—Getty Images

Holiday get-togethers are a great time for extended family members to discuss topics like estate planning and eldercare. Here's how to get started.

While most Americans are focused on turkey dinners and Black Friday sales, some financial advisers look to Thanksgiving as a good time for families to bond in an unlikely way: by talking about money.

The holiday spirit and together-time can make it easier for families to discuss important financial matters such as parents’ wills, how family money is managed, retirement plans, charity and eldercare issues, advisers say.

While most parents and adult children believe these discussions are important, few actually have them, according to a study conducted last spring by Fidelity Investments. Family members may avoid broaching these sensitive subjects for fear of offending each other.

That is where advisers can shine.

“When you help different generations communicate and cooperate on topics that may keep them up at night, it bonds them as a family,” says Doug Liptak, an Atlanta-based adviser who facilitates family meetings for his clients. It can also help the adviser gain the next generation’s trust.

Advisers can encourage their clients to call family meetings. They can also offer to facilitate those meetings or suggest useful tips to families that would rather meet privately.

Talking Turkey

Family meetings should not be held over the holiday table after everyone has had a few drinks, but at another convenient time.

“That may mean in the living room the next afternoon, over dinner at a fun restaurant, or at a ski lodge,” says Morristown, N.J.-based adviser Stewart Massey, who has vacationed with clients’ families to help them hold such mini-summits.

It is critical to have an agenda “and be as transparent as possible,” he says. Discussion points should be written out and distributed to family members a few weeks ahead to avoid surprises. Massey also suggests asking clients which topics are taboo.

Liptak likes to meet one-on-one with family members before the meeting. If you can get to know the personalities and viewpoints of each family member and make everyone feel included and understood, you will be more effective, he says.

“You might have two siblings who are terrible with or ambivalent about money, while the youngest is financially savvy, but you can’t give one person more say,” says Liptak.

It also helps to get everyone motivated if the adviser brings in the client’s children or other family members ahead of time to teach them about money management topics, like how to invest, says Karen Ramsey, founder of RamseyInvesting.com, a Web-based advisory service.

Sometimes the clients are the adult children who are afraid to ask how the parents are set up financially or where documents are, she says.

Ramsey says advisers can help by letting clients and their families know that a little discomfort may come with the territory. She will say, and encourages her clients to say: “There’s something we need to talk about and we’ll all be a little uncomfortable, but it’s okay.”

The adviser can kick off a family meeting by asking leading questions, such as “What one thing would you like to accomplish as a family in 2015?” says Liptak. Then the adviser can take notes and continue to facilitate the discussion by making sure everyone gets heard and pulling out prepared charts and data when necessary.

Massey suggests families build some fun around the meetings. His clients often schedule them around the holidays and in the summer, often tucked into a vacation or weekend retreat. It is a good practice to have them regularly, like board meetings, he says.

And if the family has never had a meeting before?

“Don’t start with the heavy stuff,” says Liptak. “It’s a good time to focus on giving and generosity, like charities the family can contribute to.

“You can collaborate on an agenda for later for the bigger issues.”

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