Your complete estate planning checklist

Derek Silva

Derek Silva

Published July 29, 2019

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Estate planning covers two main issues: what happens to your things after your death, and what kind of care you want to receive should you become incapacitated — unable to take care of yourself or manage your own affairs.

The way you actually address these issues is with an estate plan. Your estate plan is a collection of documents with your wishes and instructions for the management of your estate before and after your death. Your estate is simply everything you own at the time of your death.

It can be daunting to plan for your own death and it’s easy to ignore when you’re young, but having a strong plan in place will make things a lot easier down the line. It prevents your loved ones from having to make difficult decisions while they’re grieving. It can also prevent issues that might drag out the probate process.

In this article:

Assets to include in your estate plan

The best way to start estate planning is with a list of all the assets you need to pass to your heirs. Make sure you consider all of the following assets if you have them:

  • Bank accounts
  • Retirement accounts (IRAs, employer-sponsored accounts, pensions)
  • Health savings accounts
  • Investment and brokerage accounts
  • Any paper certificates, like a treasury bond
  • Real estate
  • Personal property of value
  • Safe deposit box information
  • Insurance policies
  • Business interests you have
  • Digital assets, like passwords and email accounts where you receive important communications
  • Any debts you owe

Additionally, you should make note of things like all the credit cards you have and where you receive your paychecks. After your death, someone will need to make sure your bills get paid. Having a list of all your accounts can make this process much easier. Someone will also need to file an income tax return for you, so try to keep information on your previous tax returns in one place.

As you make this list of assets, also mention if anything is jointly owned or jointly titled.

Read more about the types of assets you might have.

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Takeaway

A will is the best way to ensure your property goes to your loved ones after you die.

7 questions your estate plan should answer

As you go through the estate planning process and create your plan, you should make sure that you answer the following questions:

  • What kind of care do I want to receive if I become unable to care for myself?
  • Who do I want to handle my financial, medical, and legal affairs if I become incapacitated?
  • Is my estate worth enough to trigger estate or inheritance taxes?
  • What assets do I need to pass on to my heirs?
  • Who do I want to receive my assets and how much do I want each person to receive?
  • Who do I want to manage the disbursement of my things?
  • Who will become the guardian of any minor children?

If your estate plan doesn’t provide an answer for each of these questions, you should revisit it. Instead of creating completely new documents, you may be able to revise the documents you already have. In general, there are only a few documents that truly need in your estate plan.

Estate planning documents checklist

With six documents, you can answer the questions from the previous section and cover most situations that arise around the time of your death. At the very least, you should have the first four documents here and consider the final two.

Did you create (or at least consider) these documents?

  • A last will and testament to cover disbursement of your assets
  • A letter of instruction to state personal wishes and fill any gaps in the will
  • A living will that details the care you want to receive if you’re incapacitated
  • Durable power of attorney, to state who handles your affairs if you’re incapacitated
  • Life insurance policy to financially protect your spouse and dependents
  • Living trust to simplify asset disbursement to heirs

Read more about the types of documents you need for estate planning.

Why you need these documents

Your last will and testament, or simply your will, covers who gets what assets and how much they should each receive. This is possibly the most important document listed here. It’s possible that you don’t have many assets or don’t care who gets them, but you can make things a lot simpler for your loved ones by already planning what happens to your things.

If you have a specific plan for what you want certain heirs to receive, consider making a revocable living trust. It requires more up-front work from you, but may make it much easier for heirs to access your assets. Some people use a living trust instead of a will, but you may benefit from both.

A letter of instruction has the instructions of your will written in plain English. It isn’t technically a legal document, so no one needs to honor what you say in it, but it can help explain your wishes or expectations for your assets and heirs. Definitely include this if you’ve written a will on your own, in order to clear up any gaps or confusing language.

(Learn more about how to create a will online.)

In the event that you become incapacitated and unable to take care of yourself, your loved ones can know the health care treatment you wanted to receive via your living will. (Be careful not to confuse this with your regular will.) A living will, also called an advance directive, should cover all your preferences around end-of-life care.

You can name the person who will manage your affairs if you become incapacitated but having a durable power of attorney (DPOA). This legal document names who can legally act on your behalf, including if you become mentally incapacitated. The person you name will be able to make financial, legal, and medical decisions for you.

A life insurance policy is important because, should you die, it will make a payment to your spouse or beneficiary of your choosing. This can help them to manage bills and expenses that you had previously been helping to pay. That often includes a mortgage or child care payments. They may also have to handle other debts that you were previously paying on your own, like private student loans. Policygenius can help you find the best policy for your situation. Compare life insurance quotes here.

What if I need help estate planning?

Estate planning is challenging but you don’t have to do it alone. A local estate planning attorney will have the knowledge and experience to help you. They can assist you with listing your assets, determining who you want to give things to, and creating the essential documents listed above. They can also provide legal advice for more specific situations, like minimizing the estate tax or making a succession plan for a business.

As you’re considering attorneys, check this guide to finding an estate planning attorney.

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Policygenius’ editorial content is not written by a certified financial planner or advisor. It’s intended for informational purposes only and should not be considered legal, financial, or investment advice. Consult a professional to learn what financial products are right for you.

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