Insights + Resources

Are You Fi-Organized?

May 5, 2014

Is your financial house in good order? Do you know where everything is?  How long would it take you to pull together all of your important financial documents? Minutes… or hours? Some of you may be thinking it could take days because you aren’t the one who handles the finances for the household or even if you do, you may have forgotten how to access certain financial documents online, or maybe worse, things are just scattered everywhere. The answer should be “minutes.” And if it’s not, it’s truly time to get financially organized, or as I like to call it, Fi-Organized or Fi-Org’d for short.

Think about this example: What if your family’s home caught fire and, in that fire, you lost all of your financial documents. What would you do? What would be your first step, or who would be your first phone call? Let’s consider another example: Let’s say you are the one who handles the finances in your household and you have everything in good order. Does your spouse or significant other know where everything is, do they know your organizational system and do they have access to everything?  If not, what would happen to them should something happen to you?

Being Fi-Organized is knowing where all of your important financial documents and accounts are located, having direct and remote access to those documents and accounts, and making sure there is someone in place that knows the same in case you are no longer around to point him or her in the right direction.

The first step is simply to have physical organization. This would entail having, in one very safe place, sample hard-copies of all of your banking and investment account statements, insurance contracts, employee benefits papers, trust documents, titles and deeds to automobiles and real estate, other contracts, legal documents such as wills, powers of attorney and health care directives and liability statements such as credit cards, mortgage documents, etc. Please know that there are many other important financially oriented documents and that this is by no means a complete list.  In fact, the more moving parts in your financial life, the more documents. It’s that simple.

The next step is to preserve the integrity of these documents. Hence, make copies… digitally. This is probably the most time-consuming step. You want full and complete digital copies, not just the front or first pages. This is easily done via a scanner, which you can buy at any local office or electronics store. Because Fi-Org is a big focus at my firm, Epic Capital, we actually provide our clients a detailed list of documents to be uploaded in order to expedite the copying process on their behalf, which saves them a lot of time. Once you have all of your documents scanned (usually as a .pdf file) the next step is to offload them and then upload them.

Offloading the document images allows you to have everything saved onto a small portable electronic device. You could probably use a removable thumb drive (a little storage device that you can buy almost anywhere; even Harris Teeter sells them), but we recommend a larger (and more expensive) external hard drive because that can be encrypted for added security and the protection and privacy of your data. Once you have these images offloaded onto your portable device, we recommend that you store it, again, in a very safe place.

Here are a few examples of what one could deem a “safe place,” and corresponding details to consider:

• A safety deposit box – who has access to this other than you and possibly your spouse, should something happen to you both? It’s of no value if it can’t be accessed in your absence.
• At your workplace – let’s not kid ourselves, nothing is overly safe at your workplace.
• A fireproof floor safe – this is probably the best choice but if it is where your originals are also stored, you really need to have that same data uploaded to a secure site online.

 We recommend uploading the images to a safe and secure online site if your financial planning firm offers this (we call ours the Epic Online Vault, although I know some other firms have similar technology). This is a critical step because it gives you the ability to access these files 24 hours a day, 7 days a week… from anywhere. You can also allow for select family members or members of your financial advisory board (CPA, CFP, attorney, financial advisor) to access these documents as well, or in your absence.

 Let’s say you were traveling overseas and lost your passport—big problem, right? What if you had your passport uploaded to your online vault and could pull it up on your cellphone at the airport? Don’t you think that would help to expedite your getting onboard? You bet it would. What if you became incapacitated but had your medical directive uploaded online and your spouse could access that document from a computer at the hospital? What if your home did catch fire and your documents were lost? Having your important documents accessible from anywhere is a key step in being truly financially organized.

Whether you are in your 20s and are single, or in your and 40s and have a family, or if you are mature in years and have a legacy to protect, one of the most important things to keep in mind in being truly Fi-Organized is that you are not just doing this for yourself, you are also doing this for those who follow.

As Seen in Society Charlotte Magazine, May 2014.  Written by Edward R. Doughty, CFP®.