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Why You Need an “Income Book” and 5 Things to Include in it

If you’re in or approaching retirement, I’m sure the thought has crossed your mind a time or two: “if my spouse dies before me, how will I support myself month-to-month?” It’s not uncommon for married couples to have separate investment or retirement accounts, or for one spouse to not know the details of the other’s accounts. Putting all of this information into a single document, an “Income Book”, will make it easier for the surviving spouse to carry on after you’re gone and pay for expenses as they become due. Your Income Book sets out what your spouse can expect for income after you pass. Here are five things to include in your Income Book:

1. Social Security Survivor Benefits: Generally speaking, the surviving spouse will get 100% of the Social Security benefits of the deceased spouse, or their own benefits, whichever is larger, plus inflation adjustments. Social Security benefits may be subject to income tax and can be maximized by delaying the payment of the benefit as long as possible.

2. Life Insurance: If you have insurance products with your spouse named as the beneficiary, you should include the policies and their account numbers, as well as the benefit of each policy and how to make a claim for the benefit. Life insurance proceeds are generally untaxed and can provide a substantial benefit to your spouse in the short term to pay off debts, or can be stretched out over time to maximize its benefit long-term.

3. Pension and Annuities: If you have a retirement pension or annuity, you chose the percentage of your payments that would go to your surviving spouse. Pensions and annuities often have withholding deduction requirements. Because the gross amount of the survivor’s fixed payments will not change, the surviving spouse will have to save part of the payments to compensate for future inflation.

4. Savings: List the name and last year’s year-end balance of each individual investment account you have, as well as the account number. This will have to be updated after you’re gone. Some of these accounts can be stretched to maximize the benefit to the surviving spouse.

5. Financial Team Contact Info: It’s likely that your spouse will have some idea who your financial advisor, CPA, and life insurance agent are, but, just to be safe, it’s best to keep a business card or some other form of contact information for any financial professional involved in 2-4 above. These professionals will be able to stream-line the process of making your accounts available to your spouse to avoid any unneeded delays.

Paul Yokabitus

Author Bio

Paul Yokabitus

Paul Yokabitus is the CEO and Managing Partner of Cary Estate Planning, a Cary, NC, estate planning law firm. With years of experience in estate and elder law, he has zealously represented clients in various legal matters, including estate planning, guardianship, Medicaid planning, estate administration, and other cases.

Paul received his Juris Doctor from the Campbell University School of Law and is a North Carolina Bar Association member. He has received numerous accolades for his work, including being named among the “Best Attorney in Cary” in 2016 and 2017 by Cary News and Rising Star in 2020-2023 by Super Lawyers.

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