"Black Box" for your financial life

 Do you have a black box for your financial life?

Do You Have A “Black Box” For Your Financial Life?

By Andy Garrison, MBA, CFP, Wealth Advisor

Are you as organized in your financial life as you are in the cockpit? Do you know everything you have, where it is, and whose name is on it? Are all of your online accounts and passwords somewhere that can be accessed easily? Most importantly, is all of this written down somewhere?

We all know that a “black box” in an airliner is needed to record important data in the event of an accident or mishap. It’s never fun to think about such things happening in our lives, but getting organized financially is important for you and your loved ones. By creating your own “black box” of sorts, you’ll be ensuring the security and ease of access of your assets should the unthinkable happen.

Why Does It Matter?

Not only does it help you by knowing exactly what you have and where it is (and how it’s titled), but it helps your family in the event something happens to you. 

Making sure you’re organized and have all of your financial information in one place will save you many hours a year searching for the information you need. Imagine back in the days of paper charts…if you had all of your papers thrown about the cockpit haphazardly, you would have a heck of a time finding what you needed in short order. Your financial life works the same as your cockpit: if you don’t have things organized, you’re burning time and energy needlessly and adding to the stress of your already hectic life. In addition, it makes sense to have everything in one safe and secure location. That way, if there is an emergency, all of your financial details can be located easily.

Following are tips on how to get financially organized.

Step 1: Lay It All Out

The first step is figuring out what accounts you have and where they are located. In addition, you also need to know whose names are on the accounts. If you’re married, do you and your spouse own financial accounts jointly? And, if so, is it “joint with rights of survivorship” or “tenants in common?” If you’re wondering what those phrases mean, it’s a good indication it’s time to get started!

While it may seem rudimentary, a good place to start is by listing out all your accounts and the name on each. Make sure to include:

  • Retirement accounts (401(k)s, profit sharing plans, etc.)
  • IRA accounts
  • Taxable brokerage and investment accounts
  • Checking accounts
  • Savings accounts, including Health Savings Accounts (HSAs)
  • Mortgages, student loans, car loans, credit cards, and other debt accounts
  • Insurance accounts (both term and permanent insurance policies)
  • Other workplace benefits (loss of license, disability insurance, etc.)
  • PayPal and other online payment processors
  • 529 or other college savings accounts
  • Anything else that involves money and an account number

If you haven’t created a balance sheet yet, now is a good time to do that, too. In the simplest sense, a balance sheet lists out everything you own and everything you owe and nets the two together. The resulting number is your net worth. 

Once you’ve listed out all of these accounts, it’s time to go into more detail.

Step 2: Get The Critical Details

After you’ve created your list of accounts, it’s time to put in the most critical information: the account numbers and how to access the accounts. If you have an advisor, or person who manages accounts for you, you’ll want to list their names and contact information as well. 

If you have online access to the account, include your login ID and password. This information should be kept in a safe place such as a safe deposit box. Or, if you are a client of Mariner Wealth Advisors, you have access to an online vault to store all of your personal and account information. Of course, don’t forget to update your “black box” when your password changes!

Step 3: List Subscriptions, Bills and Other Automated Payments

Make sure to list your subscriptions, account numbers, logins and passwords associated with each. Do you subscribe to Netflix, AOPA or other magazines, streaming services, or publications? Make sure to list all of these as well. 

What bills do you have paid automatically each month? Make sure to include these in your “black box” so they are easy to identify if someone ever needs to know. An excellent bonus to doing this is you often find several items you are paying for that you don’t need anymore!   

Step 4: Final Touches

Consider listing the following items in your “black box” to round out your records. Doing so not only gets you financially organized, but it will make it significantly easier for anyone that needs to access this information on your behalf one day. 

  • Car titles -- where are they held? (And better yet, place copies in your “black box”)
  • Car registration/tax records
  • Car insurance - place your documents in here
  • Homeowner’s or renter’s insurance document details
  • Advisors names and contact information (accountant, attorney, financial advisor, insurance person, etc.)

Once you have these final touches on your “black box,” you are well on your way to being financially organized.

The views expressed are for commentary purposes only and do not take into account any individual personal, financial, or tax considerations. It is not intended to be personal legal or investment advice or a solicitation to buy or sell any security or engage in a particular investment strategy.