Are your loved ones protected and are your end of life affairs currently in order? Whoa - come again? This is a question most people give some thought to but often don’t take any action on.
In fact, over the last few weeks, in our Investing and Personal Finance Facebook group, about a dozen people have asked or mentioned getting a will and trust setup for their family. That's a great step, but sadly, too many people don't take it.
The reasons? It's not fun to think about. It's confusing. It's expensive. Lawyers are scary. I'm afraid to do it myself... The list goes on and on and on.
Your family is protected when you have life insurance. If something happens to you, your life insurance policy will pay out, easing the burden on your family.
What about your kids? What about your assets? That's where a will and trust come in.
These are heavy questions to consider but isn’t ensuring your family doesn’t have to worry worth it?
Tomorrow.Me - An App For Estate Planning
Tomorrow is an app that helps you create a will, living trust, distribute assets, and purchase life insurance if you don’t yet have any. The app basically handles your end of life affairs.
Let’s dig deeper into what Tomorrow is all about.
Tomorrow’s CEO, Dave Hanley, wants to take the morbid out of planning for end of life. It’s a topic people don’t often want to talk about.
“We knew that people don’t like to think about their own mortality,” Hanley said.
It’s also confusing. People simply don’t know what they don’t know when it comes to life insurance, wills and trusts.
Tomorrow has created an app that is visually appealing and walks you through a series of questions to create the right documents for your will. If you don’t have life insurance, you can purchase it right from the app.
Hanley goes on to say, “Thinking about that is only part of a plan you need to put together for your family.
Everything from the brand name of Tomorrow, focusing on the future, to the iconography in the app, to the social experience where I begin by typing the name of my wife in — all that had to be tested and carefully crafted.”
Others think Tomorrow is on to something. In July 2017, the company raised $2.6M from a number of venture capitalist and angel investors, including Maveron, CFSI, Echelon Capital, and Clocktower Technology Ventures. Tomorrow also won $250,000 from a JP Morgan-funded fin-tech competition.
Tomorrow is free to use and makes a profit from users who purchase life insurance through the app.
The Tomorrow App
Tomorrow is available for iPhone and Android. The app will ask you a series of questions, culminating in the creation of a will.
While you can buy life insurance through Tomorrow, you can also integrate your existing insurance.
For those purchasing life insurance through Tomorrow, you can choose the carrier of your choice.
Setting up life insurance and a trust can be complex. Some of the questions that need to be answered are:
How does Tomorrow handle these types of questions? By linking to videos and keeping things fairly simple, Tomorrow allows people to complete the process. Below is an outline of the process:
Overall, Tomorrow is focused on inheritance: who’s going to get what, who’s on my team, who’s going to help me?
In the event the life insurance needs to be activated, you can go directly through your insurance carrier. Or call Tomorrow, who will direct you through that same process.
Setting Up A Will And Trust
I went through the process of setting everything up in the app and it's pretty easy to use. It takes a second to get used to the navigation - and it will ask you every screen if you want notifications (annoying). But it gets everything you need done.
You start by entering all your contact information. You also need to connect Tomorrow with at least 3 people. It's not required, but highly encouraged. Why? Because what if you die! Someone needs to know your last wishes.
Furthermore, when you connect 3 people, Tomorrow will give you a $5,000 Accidental Death and Disability Life Insurance Policy for free. So hopefully that's some incentive for you!
Adding Your Financial Information
Once you enter your information, you can enter your money! You should add all your bank accounts, insurance policies, and investments here.
That way, if you do die, your contacts will know where your money is and what you have. This is also important for setting up a trust.
Add Your Belongings
The next step is to add your stuff. This is stuff you might want people to inherit. Maybe your coin collection, or your jewelry.
You could also include your vehicle or any random item if you wish.
Design Your Family
The next step is to add all your family members. Once again, this is to ensure that there is accurate contact information for everyone if you die.
Tomorrow can connect to your phone's contacts and import things to speed up the process.
You can also include pets and trusted advisors (like financial planners or accountants) here.
After you have the basics input, you need to request roles to handle things when you die. You should name an executor of your will - this is who will carry out your wishes based on what you input into Tomorrow.
You also name a Trustee for your trust - this is who will manage your money in your trust.
Finally, if you have children, you need to name a guardian for your kids. This is a person or couple that you trust to raise your children if anything happens to you.
These roles can be the same person, or different people. For example, if you know who would make a great caregiver to your kids, but they are terrible with money, you could only give them guardianship - and have someone else manage your trust.
Will and Trust
After you get everything setup, it's time to start making your will and trust.
Your will is really about guardianship of your kids and distributing your stuff. The trust is all about your money.
What type of will and trust does Tomorrow setup? The main goal of the Tomorrow app and wills is that your assets don’t go through state probate and are instead distributed based on your wishes.
There is an orderly transfer of your assets in other words.
If you aren’t familiar with wills or trusts, a living will and trust are the same. There are two main types of trust - revocable and irrevocable. The Tomorrow app uses revocable trust.
This means you can change the trust while you’re alive and even dissolve it.
It’s certainly better to have a trust setup than not. If you have no type of will and pass, the state can then distribute your assets as they see fit. That’s a scenario you don’t want to happen.
Thomas J. Bogar, an attorney in Cheltenham, Pa, says ”A trust is often preferred for people concerned with privacy and avoiding probate.”
Probate can take months and become expensive. Besides the grief your family is already going through, probate is just an added burden.
Don't Forget To Execute Your Trust
The hard part is, once you have your trust documents setup, you need to actually execute your trust. Tomorrow didn't provide much information here, and it could be worth seeing a lawyer if you're unsure of the next steps.
But, once you create your trust, you need to move your assets (like your house, bank accounts, etc) into the name of the trust. For your house, this can require a quit-claim deed, and more. You might want to get professional help to do this.
Tomorrow can’t replace trusts setup by attorneys. However, it's a great free tool that can help you get the basics down, and it doesn’t cost as much as sites like LegalZoom and RocketLawyer.
For many people, using an app like this will save headaches later, in just a few minutes.
By providing a free app and a streamlined, user-friendly process, Tomorrow is helping many people setup their end of life affairs for the first time.
If you don't have a complicated estate, this can make a lot of sense.
Do you have life insurance? What are your thoughts on Tomorrow.me?
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him here and here.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.