Six steps to create an estate plan

Estate planning is about deciding how your money, property and belongings will be managed after you’re gone. Without a plan, state laws take over — and their choices may not match yours. By documenting your wishes, you ensure your legacy is honored.

Who needs estate planning? 

Just about anyone. Estate planning isn’t just for the wealthy — it’s for anyone who wants to make sure their wishes are respected, and their loved ones are taken care of. If you own anything or have people who depend on you, estate planning is a smart move for you and your loved ones. 

Why estate planning matters

Estate planning is crucial because it allows you to:

• Avoid probate court: A will can help your estate avoid the lengthy and often costly probate process.
• Name a guardian for minor children: If you have minor children, naming a guardian in your will can prevent family court from making this decision.
• Settle debts and taxes: Ensure that your debts and taxes are settled so that your remaining assets can be distributed according to your plan.
• Protect your legacy: Organize your financial life and make sure your loved ones know how to access important documents and accounts.

Ready to get started?

1. Get professional guidance if you need it

Whether you have a complex financial situation or not, finding the right professional can help you get started. Here are a few you may wish to consider:

• Financial professional: Helps you organize your assets and may refer you to legal experts
• Estate attorney: Guides you through legal documents and requirements
• Tax attorney: Advises on minimizing taxes for your heirs

2. Get organized and take inventory

Organize key documents — like bank statements, insurance policies and retirement accounts — in a secure folder. Remember that life insurance, if structured properly, can bypass probate and taxes altogether allowing immediate relief for your beneficiary, such as your spouse.

List all assets and debts and share the folder’s location and passwords with a trusted person, such as your chosen estate trustee.

• Home mortgage, car loans or title, jewelry, credit cards and debts
• Bank, retirement, investment and savings account info
• Property titles and business ownership
• All legal and fiduciary names contacts
• Social Security card, passport, driver’s license, military ID
• Marriage/divorce certificates, birth certificates and anything else of value

3. Where there is a will, there is a way

Create or update your will. Many assume their assets automatically go to family. Not so. Without a will, a court decides who gets your assets — which may not match your wishes. To avoid this, you’ll need to clearly name who should receive specific items. Life changes like marriage, divorce, having a child or moving to a new state are all good reasons to update your will and beneficiary designations.

4. Choose wisely; key decisions in estate planning

Estate planning isn’t just about dividing assets — it’s also about making important choices:

• Beneficiaries: Choose who will receive your assets. Make sure beneficiary designations on insurance and retirement accounts are current as they will override your will.
• Executor: Pick someone you trust to conduct your wishes and manage your estate. Talk to them in advance to ensure they’re comfortable with the role.
• Guardian and trusts: If you have young children, name a guardian. Without one, the court decides. You might also set up trusts to support their care.
• Living will and power of attorney: Appoint someone to make medical or financial decisions if you’re unable to. A living will covers all things health care, and a durable power of attorney manages finances on your behalf.
• Final arrangements: To avoid family disputes, record your funeral and burial wishes in a document separate from your will. Share your plans with loved ones and ensure someone knows where to find them.
• Settling your estate: Also, be sure to have enough money available to cover the immediate costs of settling your estate.
• Tax implications: Estate taxes can reduce what your heirs receive. To avoid them, work with a tax professional to minimize tax burdens through a trust or other strategies.
• Be transparent: Surprises can lead to confusion, conflict or even legal battles within families. Communicate your wishes clearly to every person named in your estate plan and let your executor know where your documents are stored.

5. Make a plan for your digital accounts

Digital footprint: And don’t forget to leave instructions for your executor on how to manage or delete your social media accounts, apps, savings and any online subscriptions. Make sure all online accounts, account numbers, URLs and passwords are up to date and included for everything online.

6. Keep your estate plan current

Life changes — your plan should too. Stay on track by:

• Meeting annually with your financial advisor and estate attorney to review and update your plan.
• Checking in yearly with yourself and your tax advisor to ensure everything is aligned.
• Communicating with family, especially your executor, about any updates.
• Storing documents safely in a weatherproof safe or lockbox, and letting trusted people know where to find them.

Final thoughts

Estate planning isn’t just about money — it’s about making things easier for the people you love. These steps could help to offer your family clarity during a difficult time. It’s never too late to start, and every step you take now helps protect the ones you love.