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Estate Planning Checklist

October 24, 2019
Many people assume that estate planning is only for the wealthy, inadvertently causing complications for families after their death. But estate planning isn’t just about money or family heirlooms; there is far more at stake, including the welfare of your loved ones. Here are the most important steps you should take:

Prepare a Last Will

The first and most imperative step is to have a last will and testament prepared, specifying the following:
  1. Your heirs
  2. The executor who will implement your instructions
  3. The designated guardian who will act as caregiver of your minor children
  4. The guardian who will manage assets you leave to minor children

Name Your Durable Power of Attorney

A durable power of attorney is the person you choose to oversee your finances should you become temporarily or permanently incapacitated; he or she will manage your bills, bank deposits, medical benefits, and insurance when you are unable to do so.

Establish a Living Will/Healthcare Directive

There is an unfortunate chance of becoming temporarily or permanently unable to make your own medical decisions. A living will defines your medical preferences such as whether you wish to remain on life support. You should also designate a healthcare proxy, who advocates on your behalf to ensure your medical instructions are carried out.

Choose Your Beneficiaries

Be sure to set up or revise the beneficiaries on your savings and checking accounts, life insurance policies, retirement plans, and even stocks, bonds, and brokerage accounts.  Understand that because a named beneficiary on an account will override your will, people can unknowingly disinherit a loved one.

Familiarize Yourself with Estate Tax Laws

Estate taxes levied against your total wealth—which occurs prior to any distributions—could dramatically impact what your loved ones or chosen charities receive. Careful review of your assets along with strategic planning can protect your legacy.

Consider Life Insurance

If you’re married, have minor children, or even a disabled adult child, life insurance is a great way to assure your loved ones will continue to receive financial support in the event of your death. Properly structured, beneficiaries can receive the life insurance proceeds with no income- or estate-tax ramifications.

Think About Funeral and Final Arrangements

Do you plan on donating organs? What type of funeral service do you envision? Why burden family with such difficult decisions when you can plan ahead with a written document specifying instructions for the disposition of your body and funeral service preferences?

Protect Your Business

Owning a business can significantly complicate your estate, as any accrued assets won’t necessarily transfer to spouses or beneficiaries without proper directives. Likewise, if you share a business, make sure you have an arranged buyout agreement, which among several other scenarios, plans for the event of your death.

Set Up a Trust

The larger the value of your estate, the more you should consider setting up a trust. Similar to a last will, a trust allows you to designate financial beneficiaries and even a guardian for minor children, with three important advantages over wills:
  1. Assets retained through a trust are not subject to probate, therefore allowing for faster distributions to loved ones or cherished organizations
  2. Unlike wills, trusts are not considered public documents, providing the added benefit of privacy
  3. You can place special conditions on your legacy, such as when it should be dispersed and how it can be spent, which may be more beneficial for young-adult recipients or irresponsible heirs

Store Your Documents

Make sure your power of attorney or executor has quick and convenient access to your important paperwork: wills and trusts, life insurance policies, bank and retirement account statements, certificates of other assets, mortgage paperwork and real estate deeds, and debts. The last thing you want is for your family to be unable to locate an important document. Our Peace of Mind Checklist categorizes important contacts and life documents so that you can list important professional contacts, the life documents that you do have, and where they are kept.  The Peace of Mind Checklist is available for print on our website’s Knowledge Center.


Copyright © 2019 This article is published in its original form from its original publication with Investment Answers and Integrated Concepts, a separate, non-affiliated business entity. The original newsletter publication, Investment Answers Financial Success Fall 2019, is intended to offer factual and up-to-date information on the subjects discussed but should not be regarded as a complete, evolving, or personalized analysis of the topics, and should not be construed as personalized investment advice. Qualified financial professionals should be consulted before implementing a personalized financial plan. Please reference the original publication for additional disclaimers.