'As good a death as possible': This WSJ money expert with terminal cancer has a parting gift for readers — his tips on organizing your estate and leaving your family in good financial shape

Keeping accounts and vital documents up to date

After his diagnosis, Clements sat down with his wife Elaine and his two children, Hannah and Henry, to tell them what they could expect from his estate. Though his finances were already well-organized, Clements wanted to make things even simpler.

“I’ve closed a small inherited IRA, canceled two of my four credit cards, made Elaine the joint account holder on two bank accounts, and rolled my solo Roth 401(k) into my Roth IRA.” Clements shared.

Joint accounts are typically held with “rights of survivorship,” meaning that if one account owner passes away, the funds automatically transfer to the surviving owner.

Clements also took steps to revise his will, update his financial and medical power of attorney and ensure his retirement account beneficiaries were up to date. However, not all Americans are taking similar precautions.

According to Caring.com’s 2024 Wills and Estate Planning Study, only 32% of Americans have a will, a 6% decrease from the previous year. Of those without a will, 40% believe they don’t have enough assets to warrant one.

“Wills and estate planning are essential for everyone, not just the wealthy,” Patrick Hicks, general counsel of Trust & Will, an online estate-planning service, told Caring.com. “Every person over the age of 18 should have an estate plan, no matter their financial situation.”

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Simplifying asset liquidation

For Clements, a key part of his financial strategy was ensuring his family could easily access his assets after his passing. He noted in The Journal that keeping his funds in individual retirement accounts (IRAs) rather than in an employer-sponsored plan made the withdrawal process much smoother. And since Clements is over 59-and-a-half years old, he could avoid tax penalties

Had his wealth been tied up in less liquid assets, such as real estate, private partnerships or tax-deferred annuities, the process would have been far more complicated. Clement prioritized financial flexibility for his family, ensuring they could access cash without the hassle of selling off assets.

But not all assets can be passed on as easily as a bank account with a named beneficiary. Some may be subject to probate, which is the legal process by which a will is reviewed and verified. This can be both time-consuming and costly. According to Trust & Will, the average time it takes to complete probate is 20 months and it can cost 3% to 7% of the estate’s value.

To spare his family from any increased stress and expenses, Clements has been proactive in his estate planning. It can pay to take steps to make the probate process as simple as possible and ensure a smoother transition for loved ones.

Financial gift giving

There’s no reason to wait until your death if you want your heirs to inherit some of your assets.

Even before his diagnosis, Clements says he regularly gave financial gifts to his children, Hannah and Henry, staying within the annual gift-tax exclusion limit. In 2024, this limit is $18,000 per recipient and will go up to $19,000 in 2025. Gifts exceeding the limit must be reported to the IRS.

But gifting past the limit doesn’t necessarily mean you will pay taxes. Any overages count against your lifetime limit, which in 2024 is $13.61 million and will be $13.99 million in 2025. Once the lifetime limit is exceeded, you’re required to pay the gift tax.

Incorporating gift giving into your financial planning can benefit your loved ones at an earlier stage in their lives, allowing them to accelerate their savings goals or earn more compounding gains through investing.