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You Have a Financial Plan. But Does Your Family Know It?
What happens when the person who manages the family finances is suddenly gone
FINANCEBLOG
Sneha Rege
8/29/20265 min read
I have a question I don't particularly enjoy asking myself.
What would happen to my family if I died tomorrow?
Not the emotional part. That is painful enough and impossible to prepare for.
I mean the boring, practical, deeply unromantic stuff.
Which EMI gets paid on the 5th? Which one gets paid on the 10th? Which SIP is automated and from which bank account? By when does that account need to be funded? How much is outstanding on the home loan? When does the insurance premium have to be paid? Where are the property documents? Where is the locker key? Which bank accounts exist? What investments are held where? Which passwords or access details will they need? Who files the income tax return?
And perhaps most importantly, who knows all of this?
A few months ago, I saw a version of this play out in my extended family.
My uncle died unexpectedly.
He was the person who handled the money at home. Not unusually so. In many Indian families, this is how it works. One person knows where everything is, pays the bills, manages investments, deals with the bank, renews insurance and generally knows which piece of paper is kept in which drawer.
Nobody thinks much about it when that person is alive.
Until they aren't.
After his death, the family had to deal with grief and paperwork at the same time. They knew there was a home loan, but weren't entirely sure how much was outstanding. They knew there was insurance, but had to work out which policies existed, who the nominees were and what had to be done to make a claim.
There were investments, but not everyone knew where all of them were held. There were bank accounts, property documents and tax matters that couldn't simply be paused because someone had died. Then came the smaller things that nobody thinks about until they suddenly become urgent: was the electricity bill on auto-pay, when was the car insurance due, was the property tax paid, where was the locker key, and was there rent coming in from the property?
None of these things are particularly complicated.
But grief has a way of making even simple things exhausting.
The family wasn't only trying to understand what they had inherited. They were trying to reconstruct a financial life that one person had been quietly managing for years.
And that made me think about my own family.
If I were not here tomorrow, would they know where to begin?
Would they know which accounts exist, which investments are held where, what loans are outstanding and which insurance policies are active? Would they know who to call, where the documents are kept and which payments need attention in the coming weeks?
More importantly, would they know enough to keep things running while they were dealing with everything else?
We spend enormous amounts of time building wealth. We calculate our retirement corpus, compare investments, monitor returns, buy insurance and worry about inflation.
But we don't always spend the same amount of time making sure that someone else could understand what we have built.
We assume our spouse knows. Or our children will figure it out. Or everything has a nominee. Or the bank will tell them. Or the documents are somewhere in the house.
That is not a plan.
A nominee is useful, but nomination is not the same thing as succession. A nominee does not automatically determine who ultimately inherits an asset. That is one reason having a properly executed Will matters.
A Will also does not necessarily need to be registered to be valid. What matters is that it is properly executed and witnessed in accordance with the applicable legal requirements. Given what is at stake, getting appropriate legal advice when preparing one is sensible.
But even a Will cannot solve everything.
Imagine your spouse has your Will but doesn't know where the original property documents are. They know you have life insurance but don't know which policies exist. They know you invest in mutual funds but don't know the folios. They know you have a demat account but don't know which broker. They know there is money in a bank account but don't know which account receives the rent.
The Will tells them what should happen to your assets. It doesn't necessarily tell them how to find those assets in the first place.
Then there is the financial machinery of everyday life.
Your EMI doesn't stop because you died. The electricity bill doesn't stop. Property tax doesn't stop. The income tax return still has to be dealt with. Credit card dues don't disappear because the family is grieving, and insurance premiums don't wait for everyone to feel ready.
The family has to keep functioning while simultaneously trying to understand a financial system that perhaps one person had been running almost entirely alone.
This is why I have started thinking about this less as estate planning and more as leaving a financial map behind.
The map doesn't have to be complicated. It needs to tell the people who may have to take over where the important pieces are and what they need to know.
Have a Will and keep nominations updated. Maintain a simple inventory of your bank accounts, investments, insurance policies, loans and properties. Keep important documents organised and make sure your spouse or another trusted person knows where they are. Keep the contact details of your CA, lawyer, financial planner and other important professionals in one place.
Automate whatever can reasonably be automated, particularly recurring payments and premiums. And don't make yourself the only person who understands the family's finances.
You don't need to turn your spouse into an investment expert. You don't need to explain every mutual fund you own or make them understand every tax rule.
But they should know enough to answer one basic question:
If I am not here tomorrow, where do we start?
There is another reason I think this matters.
Money can make families bitter very quickly when information is missing.
A sibling believes someone received more than they should have. A spouse doesn't know whether a property was actually promised to someone. Children disagree about what their parent intended. Someone finds an investment nobody knew existed. Someone else believes money has been hidden.
What began as a death in the family can slowly become a fight about money, fairness and trust.
And the person whose intentions everyone is arguing about isn't there anymore to explain.
That is perhaps the most uncomfortable part.
You can spend years being a responsible parent, spouse, sibling or child. You can work hard, save diligently and build a sizeable corpus. You can do everything right financially and still leave your family with a problem simply because you assumed they would know what to do with everything you left behind.
We spend years trying to make sure our families have enough money if something happens to us. Perhaps we should spend a little more time making sure they can actually find it, understand it and use it when we are no longer around to explain.
To make this easier, I am putting together a simple guide with a sample Will and a financial information document at sneharege.com. It is free. It is not a legal document and is not meant to replace professional advice. It is simply a reference point and a structure to help you start putting your own financial map together.
Because life doesn't stop for anyone.
If you die tomorrow, your family will have to mourn you and manage the financial life you were managing for them.
Don't make them figure out both at the same time.