Estate Planning – Ten Steps You Need to Take Now

Estate Planning – Ten Steps You Need to Take Now

November 19, 2013

It seems no one likes to talk about estate planning. Motivating ourselves to take positive steps toward preparing for our eventual death is not an easy subject to discuss. I have been in this business long enough to have seen some serious (and expensive) mistakes due to neglecting these very basic estate planning steps.

  1. Prepare a will and/or revocable trust. This seems obvious but I can’t tell you how many people I know who have not prepared a will.
  2. If you own real property in multiple states, consider a revocable trust to avoid ancillary probate issues.
  3. Determine or review fiduciaries — executors (personal representatives), trustees, and guardians in your will and/or trust.
  4. Determine or review successor fiduciaries in case they are needed.
  5. Prepare or revise a medical directive, health care proxy, or living will.
  6. Make certain a current durable power of attorney has been prepared, and understand the difference between a standard durable power of attorney and a springing durable power of attorney.
  7. Review all beneficiary designations, including those required for life insurance policies, retirement plans, IRAs, stock options, and deferred compensation plans.
  8. Review titling of assets, such as in individual name, trust, joint names, community property, and tenancy in common.
  9. Prepare a list of family members with birth dates, residences, and contact information, so that family members, heirs, and fiduciaries can be located in the event of an emergency or a death.
  10. Create a master list of passwords and user IDs for all computer-stored information and give it to a family member or trusted close acquaintance.

If you have questions about any of these estate planning elements, be sure to talk to your financial planner or estate planning attorney. After completing these ten steps, it is important to periodically review your estate planning objectives, particularly with regard to the estate planning effect of a birth, death, marriage, divorce or changes in tax law.