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Prepare Your Estate Plan Now: Consider These Steps

Prepare your estate plan. If not, your state may already have one for you. In case of death or physical incapacitation, your state has default laws that kick in.

Many of these laws will not manage your estate as you want it to.

If you don’t want this to happen, then creating a plan that manages your estate on your terms is the best way to go.

We know you don’t want to think about dying or being sick. You might think that setting up an estate plan is too expensive or that you don’t have enough assets to make it worth it.

Understand that death and illness isn’t easy subject to discuss, but through estate planning, you’ll be able to reduce the stress during emotionally charged times. So, it is important to prepare your estate plan. With it, an estate plan can protect your family, loved ones, and assets if you have one in place.

Let’s cover the basic estate planning steps before and after stages.

Estate Planning Basics

Let’s put all the legal jargon aside. In its simplest form, estate planning is the preparation for transferring assets to your loved ones or beneficiaries in case of your death or illness. Typically, your estate plan includes homes, cars, investment portfolios, life insurance, art and collectibles, and other financial assets and belongings. Estate planning can be separated into two stages.

1. Before Death

In this stage, these are examples of important decisions to make:
  • What are your wishes in cases of a medical emergency? These are instructions related to your wish to be put or kept on life support.
  • What are your wishes in case of incapacitation? These are instructions for who will execute and how to manage your financial affairs if you become ill, injured, or unable to manage your finances due to age.

2. After Death

In this stage, these are examples of the decisions to make:
  • Who will take care of your children? If you have minor children, you can assign guardianship and provide instructions.
  • Who do you want to leave your assets to? Identify and instruct how your wealth will be given to your beneficiaries.
These decisions should not be left to the laws of the state where you reside. Your estate plan will give you peace of mind that your wishes will be carried out exactly as planned.

Stage One: Before Death

This part of your estate plan affects both you and your loved ones. If you become physically incapable, you can assign a person to fulfill your wishes. In this stage, you may need to prepare two documents.
  1. Durable Financial Power of Attorney (POA): This document will allow you to designate an agent if you cannot handle your finances. Without a POA and a designated agent, it can be hard for someone to do things on your behalfs, such as pay bills and file taxes.
  2. Advanced Health Care Directive: This document is similar to a Financial POA and allows someone to make medical decisions for you. This person is referred to as your agent and can make decisions such as choosing a doctor, accessing medical records, and putting you on life support.

Exercise care before naming multiple people to serve as your agents instead of a single person with total authority.

Depending on how you structure your documents, each agent’s signatures may be required for every decision, so consider their schedules or locations before assigning them roles.

Make sure your banks and doctors have copies of the documents on file after you have executed them, otherwise they may deem them invalid.

It is possible that some entities require additional documentation or have specific procedures for dealing with agents. To avoid putting your agents in a difficult position, double-check ahead of time.

Stage Two: After Death

After you pass away, the second stage of your estate plan deals with what to do. An estate plan can help to avoid chaos and messiness by clearly outlining the key roles and documents.

Joint Owners and Beneficiaries:

Joint Owner: If married, this is the most common way to title your accounts as joint accounts. Your spouse or joint owner of the account will be the sole owner when you pass away. If you are a joint owner, you can avoid the state’s process of distributing your assets following your death. Adding other people, such as your children or grandchildren, as joint owners of your property for the sole purpose of avoiding probate can save time and money, however, be careful. Doing so will subject you to gift taxes, prevent them from getting a stepped-up basis. It will also give them control of any assets in your estate while alive. Beneficiaries: Most assets with beneficiaries listed don’t have to go through the court probate process. Your estate plan is made simpler as more types of assets and property allow beneficiaries. Such as:
  • Financial Accounts With banking and investments, you can add beneficiaries to those accounts. Often only required to complete a form with the financial institution or custodian of the account. Inquire with your financial institutions.
  • Retirement Accounts Retirement accounts such as 401ks and IRAs allow you to add and update beneficiaries.
  • Life Insurance With life insurance, you can designate beneficiaries to any insurance plan.
  • Real Estate Many states allow a Transfer on Death (TOD) Deed. Like a bank account beneficiary, the real estate passes the probate process.
To prepare your estate plan with beneficiaries, inquire with each financial institution or custodian to add payable on death beneficiaries.

What are the Documents of an Estate Plan?

Last Will and Testament (Will)

If no joint ownership or beneficiaries are listed, your will decides who will inherit assets. Most of the documents would be for personal belongings if you did a good job naming beneficiaries. There are other important features of a will, such as naming a guardian to look after your children and the person who is supposed to ensure your wishes are carried out.


For the benefit of your beneficiaries, you, as a trustor, will assign a Trustee to hold title to your property. With a Trustee named to oversee your estate, it is possible for increased flexibility, privacy, and control after you pass away. Keep in mind that trusts are more expensive than basic wills. However, a trust is worth considering if you have a large estate or have kids with special needs. There are many types of trusts, and an estate planning professional can help you decide which is best for you.

In the same way as with naming a POA, you should be cautious about naming multiple people to serve as your trustees. Doing so can cause many problems.

Make sure you inform who you want to serve as your executors, trustees, or children’s guardians and ensure they are prepared for the tasks. Additionally, these individuals must have access to your important documents or at least know where to find them. It is a good idea to have them meet with your attorneys and financial advisors as well.

Your Next Steps

Prepare your estate plan to help you gain peace of mind and protect you and your loved ones in cases of sickness and death. Now that you understand an estate plan better, it’s best to speak with a professional to help you through the process. When estate planning, an attorney or professional may know the specifics required for your state and ensure, based on your personal situation, how to structure your legal document. Keep in mind an estate plan isn’t a one-and-done document. It’s a living document that needs to be revised, reviewed, and amended as situations change, such as major life events: marriage, divorce, births, or deaths. Need a will or trust? Learn more about an online platform, Trust & Will, to guide you through the process.

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