Professional pilots are economically valuable assets and are worth every penny earned, but not just because they can fly safely from Chicago to LAX. The real reason pilots are so valuable to their airlines and the flying public is that they are prepared to navigate dangerous weather, handle in-flight emergencies, and make difficult decisions. In other words, pilots are trained to get their passengers safely where they want to go regardless of what happens along the way.
One of the most difficult things pilots do is to prepare for an event that will most likely never occur in your flying career. In almost 25 years of flying, I have never lost an engine (which is great because one of my airplanes only had one engine!), nor have I ever lost a hydraulic system, nor experienced a Sully-style dual-engine flameout. However, we continue to prepare for these events as if they were common occurrences. This requires tremendous discipline, preparation and intense attention to detail.
The financial equivalent of preparing for life’s catastrophes is what financial nerds call estate planning. I explain the gist of estate planning with a question to our pilot clients; will your spouse and children be okay if the unthinkable happens to you on your next trip? It takes a lot of planning and preparation to answer this question with a confident, “Yes!”
In this article I will explain the action steps and resources to help you confidently answer yes and have peace of mind knowing you’ve done everything you can to take care of your loved ones in case of a catastrophic life emergency.
Preparing for our own disabilities or death is akin to preparing for an engine loss right at rotation. It’s very unlikely that it will happen to you during your airline career. However, many pilots experience premature death and disability every year. But like the catastrophic emergency in the airplane, it’s hard to fully comprehend that it could happen to you at any moment.
I recently returned from a family vacation in Edisto Beach, S.C. The water was very rough with strong winds and currents. I shared with my kids about rip currents and what to do in case they thought they were in one. Tragically, when we returned from our trip, I noticed an article about two parents drowning in a rip tide while their six children were on the beach in Stuart Beach, Fla.. Sadly, their children tried to yell instructions to the parents while dialing 911 from the beach. It’s hard to comprehend this devastating family tragedy. I’m sure the parents woke up that morning and thought, like the rest of us, those tragic things only happen to other people. Therefor they may not have been fully prepared for this unimaginable scenario.
Can you imagine the estate planning that needs to be considered when both parents with six children pass away? Who will take care of the children- aka guardianship? Who will take care of the financial needs of the children? Especially if they are minors. These are questions many of us need to address and prepare for.
While we can rationally acknowledge that we will all die someday, we can't imagine our own deaths. In fact, it may be our brain’s biological tendency to protect us. In a research study conducted by Bar Ilan University in Isreal, Yair Dor-Ziderman explains; “The brain does not accept that death is related to us … We have this primal mechanism that means when the brain gets information that links self to death, something tells us it’s not reliable, so we shouldn’t believe it.”
“… The moment you have this ability to look into your own future, you realize that at some point you’re going to die and there’s nothing you can do about it,” said Dor-Ziderman. “That goes against the grain of our whole biology, which is helping us to stay alive.”
I probably should have prefaced that section with the same warning in the article I quoted; “Warning: this story is about death. You may want to click away now.” However, as I mentioned in the first sentence of this article, the very reason you are so valuable as a professional pilot is because it is your job to prepare for scenarios that we believe probably will not happen to us. And in the airplane, the chances are in our favor that they never will happen. On the other hand, we’re all going to die … someday! (I know you’re inspired now, right?)
Now that you know why it’s so difficult to get around to accomplishing estate planning for your family, it’s time to do some of that pilot stuff and get it done! Let’s start with the question:
Will your spouse and children be okay if the unthinkable happens to you on your next trip?
Here are the essential steps to prepare for your potential disability and/or untimely death:
- Do you have the essential estate planning legal documents?
Estate planning attorneys recommend that we all have the following documents at the ready:
- Power of attorney; financial and healthcare
- Last Will and Testament
- Beneficiary designations
- Living Will
- Life insurance policies
- Titles and property deeds
- Living Trust (may or may not be required, depending on circumstances)
- Ensure the loss of your income will be replaced by savings and life insurance.
- Does your spouse know where to find the essential documents listed above?
- Take inventory and make sure everyone knows where to find these documents and passwords. Occasionally review the contents and location.
- Does your spouse have access to cash/funding to pay bills in your absence?
- Our experience is that financial account transfers and life insurance payouts can take some time. Be sure to have access to cash to keep the household going for several months while awaiting access to other assets.
- Digital logins and passwords
- This deserves its own category now. Consider using a password manager for information security of passwords plus the ease of sharing with your spouse.
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Great resources to help with estate planning
Click here for a PDF version of an estate planning checklist from Freewill.com
Great website: https://getyourshittogether.org/ I almost always refer to this website to help people though not just because the name of the website is awesome! The founder of the organization and author of “What Matters Most”, Chanel Reynolds, experienced the premature death of her husband at a very young age. From her website, “I am immensely proud of the book and grateful for the opportunity to tell the whole story of what happened, what I wish I’d done and what you can do when life goes sideways and what can help before and after the shit hits the fan…”
Another excerpt from the website: “Will you be prepared if life knocks you sideways? Get your family protected with the critical ‘What-if’ answers like wills, powers of attorney, healthcare directives, digital details and legal documents you need today and someday…”
Online website, TrustandWills.com, for great information and getting your estate documents completed:
There is still much debate about getting estate planning legal documents accomplished online. I can’t give advice in this format, but I will say the online resources have vastly improved over recent years. Using TrustandWills.com you can accomplish estate planning and get the support of an estate planning attorney in your state.
From their website: “Just like estate planning isn’t a one size fits all deal, neither is the help that our clients need. That’s why we're giving our members access to one-on-one time with licensed estate planning attorneys in their state. We want to offer products and estate planning tools that are inclusive for everyone, whether you have a multi-million-dollar estate, or you’re just starting out planning for the future. Learn more about the benefits of Attorney Support.”
I have not personally used TrustandWills.com for my own estate planning documents, but I refer to this website regularly for great information, resources and learning.
Workbook – “I’m Dead Now What?”
We often give this book as a gift for those who prefer a physical document(s) to refer to in case of emergencies. This book, if completed correctly, covers all the nitty-gritty details that a loved one will need to know in case of the unexpected death of a spouse. The circumstances will be more difficult than we can comprehend, I believe we should not make it worse by not being organized.
Airline specific financial podcast (and shameless plug), Pilot Money Guys Flight #12: I’m Dead, Now What? This is part 2 of the Estate Planning Series “I'm Dead, Now What?” Three steps to make sure your estate is prepared. If you are unsure whether you have a good plan for the unexpected, this is the podcast for you…documents you need to have in place, why getting organized is important, and how beneficiaries and trusts go together to protect your family.
Also see, Pilot Money Guys Flight #13: I’m Disabled, Now What?
Charles Mattingly, MBA, CFP®
Hopefully, you found this article interesting and helpful. If you have any questions, I can be reached at 865-240-2292 or charlie@leadingedgeplanning.com. Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews (even the editor and founder of Aero Crew News – Craig Pieper).Leading Edge Financial Planning LLC (“LEFP”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where LEFP and its representatives are properly licensed or exempt from licensure. For additional information, please visit our website at www.leadingedgeplanning.com.
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