Learn and Plan | Seven items that should be on your estate planning list
A woman discusses her estate with her adult daughter

Seven items that should be on your estate planning list

Jun 9, 2023, 8:06:31 PM | Reading Time: 4 minutes

Estate planning is an important process of designating who will receive your assets when you pass away and allows you to leave instructions about your property, children, health care wishes, and final arrangements. No matter your income level or net worth, planning the transfer of your assets now can help minimize taxes and lessen the financial burden on your beneficiaries. To help complete your estate plan or get one started, here are seven items to add to your estate planning checklist.

1. Asset inventory

To begin the estate planning process, you will want to create a catalog of everything you own. Start with a list of tangible possessions, including:

  • Housing—house, condo, land, or other properties
  • Vehicles—cars, motorcycles, boats, aircraft
  • Collectibles—jewelry, trading cards, rare coins, artwork, etc.

Next, make a list of all of your intangible assets, for example:

  • Checking and savings accounts
  • Certificates of deposit
  • Stocks, bonds, and mutual funds
  • Life insurance policies
  • Retirement accounts—401(k) plans, individual retirement accounts
  • Health savings accounts
  • Proof of Business Ownership

Once you’ve created your inventory, you will want to gather your estate planning documents, like recent statements from your bank, life insurance company, and retirement accounts, and estimate the value of each item using appraisals or your account statements.

2. Wills and trusts

To help ensure your money and property are distributed to your beneficiaries according to your wishes, you will want to make sure you create and finalize your will. This legal document outlines the distribution of your assets after death and generally includes your designation of an executor, your beneficiaries, instructions for how and when they will receive your assets, and guardians to any minor children. Make sure the wording in your will is consistent with the way you’ve allocated assets in other documentation, such as insurance policies or retirement accounts, to prevent it from being contested. Remember, that without a will, your estate may be left to state officials who will decide how your beneficiaries will receive your assets. You may have a lawyer draft a will or you can prepare one yourself using online and offline resources. If you choose to draft one yourself, you will need to sign it in front of witnesses. Witnessing laws vary by state, but typically it is two witnesses who are not mentioned in your will.

A trust allows you to designate portions of your estate to a trustee while you’re still alive. Unlike wills, most trusts cover a specific asset, such as a piece of property, rather than your entire estate. A trust is often set aside for underage beneficiaries who can only claim it when they are old enough to manage assets.

3. Power of attorney

A financial power of attorney designates someone to manage your financial affairs if you’re medically unable to do so. Your designated agent can act on your behalf in legal and financial situations, access and manage your assets, and pay your bills and taxes. Without a power of attorney, a court may decide what happens to your estate if you are found incapable of managing it and a probate judge will appoint a guardian or conservator to oversee the management of your estate.

4. Beneficiary designations

An important aspect of the estate planning process is naming your beneficiaries. Your bank accounts, life insurance policies, individual retirement accounts, annuities, and brokerage accounts all likely require you to name a primary beneficiary, and often a secondary beneficiary. Regularly review these designations, especially after certain life events like the birth of a child, marriage, or divorce. Like wills, trusts, and power of attorney, if you don’t name a beneficiary or the beneficiary is underage or has passed away, a court will likely decide what happens to your estate.

5. Letter of intent

A letter of intent is an informal document of instructions for your executor or family outlining your personal and financial wishes following your death. These letters are not legally binding but can be added to your estate plan to provide more information about your funeral and burial arrangements, financial information, digital information, and personal items. While this document is not considered a valid legal document, it can help a judge understand your intentions, which will aid in the distribution of your assets.

6. Designation of guardianship

A designation of guardianship is an essential estate planning document that allows you to name a person to act as your guardian should you become incapacitated, as well as designating a guardian to any minor children or children with special needs if you passed away. If you do not appoint a guardian, the court will often decide who will take care of your children.

7. Financial professional

To help ensure your estate plan is in good shape or to get started on the right track, it can be beneficial to talk to a financial professional, attorney, and/or estate tax professional who can simplify the process and help you navigate state regulations and inheritance taxes. These professionals can answer your questions, help you make sure all your paperwork is in order, and be a resource for your loved ones after you’re gone. No matter how you decide to move forward when you create a sound estate plan, you can feel confident that your assets will go to the right people, you can lessen the financial burden on your family by minimizing legal and tax issues, and your final wishes will be honored.


REV 12/2022