On December 17th, 2007 I helped bury a dear friend.
He was a gifted fellow. He had handyman skills that MacGyver himself would rate an “A”. He had great skills at raising flowering plants of any sort. He reared colorful fishes. He built a “koi” pond in his house and raised the koi fishes until some of them wee almost as old as my youngest child.
He was careful with money. Not cheap, but careful and frugal.
As an employee of our National Oil Corporation, he had been sent for all kinds of training courses. Corporate equivalents of the ones people like 007 go through.
He had the uncanny ability to break down complex problems into little sub problems which were then solved systematically.
He had traveled literally the roads less trodden, the Silk Route, the jungles of Myanmar and the villages of Surabaya amongst others. Very well read and well traveled, he would regale us with stories such as those of the uncanny skills of the Indian hermits, like how he had seen them sleeping on a branch of a tree without falling off.
He was the one I called my “wisest friend”.
He died at 10 am on the 17th December 07 at our General Hospital. His wife and all his three girls were with him when he breathed his last.
As the funeral arrangements were being made, (as a Muslim, he had to be buried as soon as possible), my mind wandered on what were the really important financial things that I had to do as the head of my family.
i) Write my will
Islamic law has different views on distribution of assets, if the deceased did not leave a will. Brothers, sisters, parents and even grandparents get included and it may become quite a complicated matter. It seemed that no one knew if my friend had left a will. So in addition to the grief, there was also concern about the family finance over the coming days.
ii) Make sure there is a house to shelter my family
My friend had already paid off whatever mortgages he had on the house. However, the charge on the property by the financiers had not yet been removed and the title was still under his name. This would bring the issue of the “family house”, being included under the heading of “pool assets” to be distributed under Islamic Law. Hence putting some worries in the minds of the bereaved family.
iii) Sufficient and easily accessible cash in hand
I have no doubts about my late friend’s emergency fund. However, the funeral and immediate expenses needed cash. Whilst the amounts may not be big, cash was still needed. Financing the family expenses over the period until the issue of the will, the distribution and insurance claims etc. are sorted out is another major matter of concern.
Zen Habits featured an article titled “Big Rocks first, double your productivity this week.”
To quote Leo,
The Big Rocks are the major things you want to get done this week. A report, launching a new website, going to the gym, spending time with your spouse and kids, achieving your dreams. These Big Rocks get pushed back from week to week because we never have time to do them — our days fill up too quickly, and before we know it, weeks have passed and the Big Rocks are still sitting on the side, untouched.
He was referring to our planned output for the week, and how the big rocks represented the important things that had to be done.
Extending the same principle to my financial life, I should get the big rocks out of the way first. And these big rocks are, in my view:-
My wife and I have done our will. We have appointed administrators should anything untoward happen to both of us. This matter has been discussed at a family meeting. All our children are aware of the administrators that my wife and I have selected.
So this big rock has been taken care of.
The house we live in is under a mortgage. It has a MRT assurance attached, so that in the event of any untimely event, the loan would be paid off, by the insurance. The house itself is under the ownership of our family company, whose shareholders presently are my wife, the elder two girls and me.
Another big rock out of the way.
Sufficient and easily accessible cash in hand
The funeral expenses are quite small. So I am sure, this will be sorted out without any problems. For the subsequent period say, till the insurance claims etc., are sorted out, the family living expenses should be catered for.
In our family I am the sole breadwinner. So this is a major big rock. Whilst most of our assets are in our joint names, some of the unit trusts have been shifted into my wife’s name. This should be sufficient to take care of family expenses in the interim.
I only wish it had not taken the death of a dear friend to get me to check up on these.