An estate plan should be comprehensive.
What does an estate plan mean to you?
Does it mean throwing together a Last Will and calling it good?
This is how many people view estate planning.
This view is grossly inaccurate.
According to a recent US News & World Report article titled “12 Documents to Prepare Now for Your Heirs,” your estate plan should include some basic documents to help your family deal with your incapacity or death.
What are some of these?
As mentioned before, a Last Will is not all you need, but it is important.
A Last Will and Testament is a legal document through which you name an executor for your estate, provide instructions for the distribution of your wealth, and name guardians for any minor children.
A letter of explanation.
The Last Will handles the “what” of your distribution and estate plan.
A letter of explanation addresses the “why”.
By giving the reasons for your decisions, you can minimize hard feels and conflict among your surviving family members.
List of financial accounts and beneficiaries.
You should know what you have.
Keeping a list will help your assets to remain identified and organized.
Keeping a list of all beneficiaries on your accounts will also help you to better plan your wealth distribution.
Review these periodically to ensure your beneficiary designations are updated.
Beneficiaries on Transfer on Death or Pay on Death accounts or insurance policies will automatically receive such assets upon your death.
These are not distributed through a probate proceeding.
Having a list will also help your executor as he or she administers your estate.
Many Last Wills are general in terms of their distribution of tangible personal property items.
To ensure you do not miss anything, inventory your personal items and keep a list.
This will help you know you whether you have everything covered in your Last Will and Testament.
It can also help your executor in his or her role.
Power of attorney.
A General Durable Power of Attorney is an important part of estate planning for you while you are living.
If you become incapacitated, it gives authority to a trusted individual to make decisions on your behalf.
You will need to create one for health care and another for financial decisions.
These can name the same or separate individuals.
Life insurance policies.
Your family can miss significant life insurance benefits, if they don't know you have a policy, or it’s been lost or misplaced. Keep records of your life insurance plans and place it with your financial records.
Real estate records.
Add deeds, assessments, mortgage statements, and property tax information to the documents you've prepared for your heirs. Collecting the records for them in advance will make their lives easier.
Do you get your taxes prepared professionally?
Provide the name of your CPA so he or she can help your family file your estate tax return, if needed.
Do you do your taxes yourself?
Print copies of your files and provide and necessary login information.
Logins for accounts.
List your usernames and passwords for your email, social media, and financial accounts for your heirs.
A digital estate plan.
Some states allow for a legally binding digital estate plan.
Others do not.
Either way, it can be helpful.
With it, you can provide your wishes for your websites, digital photos, intellectual property, social media accounts, and other document and files.
You can name a digital executor, as well as name a legacy contact on Facebook or Twitter.
An ethical will.
Here you can impart wisdom, your values, and share memories with your loved ones.
Your final wishes.
Have you made advanced arrangements for your cremation or funeral?
If yes, you will need to place this in your estate plan.
You should also record who you want notified of your passing, as well as whether you would like to be an organ donor.
Does this seem like a lot?
It can be.
Work with an experienced estate planning attorney to help you create a comprehensive plan to meet your unique needs.
Reference: US News & World Report (October 4, 2018) “12 Documents to Prepare Now for Your Heirs”