How to do a Life Audit Today

There is one word that people hate to hear after they file taxes: audit! Even though an audit by the IRS is not something any of us want, a life audit is a great idea and a perfect next step for us all this week. What is a life audit? This is the chance to gather all the information about your life into one place.

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Why We Need a Life Audit Today

Why is a Life Audit a necessary thing for today? Of course, we all want to live forever and never be sick or incapacitated.  But in truth, life is unpredictable.  I don’t want to leave my family in a bind in case of an unplanned event.  I also want to know that my family is prepared for the future with all the information and resources that we have available.

There is never a good time to tackle this daunting task, but spring is a good time for clearing out clutter and tax season is a good reminder to start. If we get our ducks in a row now, next year will be a little easier.

Gather your Records:

Do you know who carries your house insurance? life insurance? health insurance? Do you know how to login or contact your agents for these important accounts? If you have a file cabinet, then pull out your files and start gathering the names, account numbers and contact information for each of the accounts. You may have to do some digging to find out where everything is stored, but give yourself some time and start looking for records.

Get organized:
Each year, I make promises that I will do better with my tax records. I promise to be more organized and decide that ‘next year’ I won’t spend days having to go through my receipts. But, most of the time those good intentions are gone the week after I send my check to IRS. This year, let’s do it differently. Let’s put together some lists and forms that will help us be ready for next year’s taxes but also will help us get our life and documents in order.

Record the Info:
If you prefer to type things into a spreadsheet, use Google sheets or Excel. If you prefer to keep a paper notebook, just get a new composition notebook or a document organization notebook and start a running list of everything.  Think of this record as the go-to source of information in case someone had to take over your life.  Are there things in your brain that no one else knows?  Get it recorded in an easy format so a family member could take care of things if you end up sick or unable to tackle these tasks.

Things to Record:

  • Who do you owe money to? Credit cards, loans, mortgage, medical bills etc.
  • How do you pay your bills?  Online?  Check mailed in each month?  Automatic withdrawal from your bank?
  • How often do these bills need to be paid?
  • If you pay online, do you have usernames/passwords that need to be updated?
  • Where do you store the kid’s social security cards?  family birth certificates?  car titles?
  • Is there a safe that you need to record the combination?

Don’t forget to update a family calendar as part of your life audit. Doctor’s appointments that are scheduled 6 months to a year out are easy to forget. Are there wedding or graduations coming up that you don’t want to miss but you haven’t written down. Do that now!

Real Life Tip: Some families keep a safe with important things that they want to be protected. But have you thought about keeping a small fire safe just for your documents? You can pick one up for under $100 and protect your insurance policies, birth certificates, wills, and documents.

Gathering this information and being prepared is not a morbid thing.  In fact, it’s more of a feeling of freedom knowing that your family could carry on if you are unable to remember these details.

Do you think it’s important to do a life audit?  Do you have these records updated and available for your family?  I’d love to hear how you keep everything organized!

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