12 Estate Planning Steps to Take Before You Die

While you may not have a large or complex estate it is still important to be prepared. Estate planning is the process of putting your affairs in order to help your loved ones deal smoothly with incapacity or death. In this article, we will go over 12 estate planning steps to take before you die.

1. Itemize Your Inventory

You should make a list of any valuable items of your personal property. This could include jewelry, art, or electronics. In this list you can name particular individuals that you would like those items to go to. You can do the same thing with sentimental items, like family photos. This can help prevent bickering after you pass.

2. Document Your Non-Physical Assets

Non-physical assets would include bank accounts, brokerage accounts, 401ks, IRAs, life insurance, and long-term care insurance. When documenting these assets, you may choose to list account numbers and where you keep important documents for those accounts.

3. List Your Debts

To help your loved ones manage your affairs it is important that you list out your debts for them. This could include open credit cards, auto loans, mortgages, home equity lines of credit, or any other debts. You can also include account numbers and where you keep account documentation for your debts.

4. List Your Membership

You may have memberships with certain organizations like AARP, veteran’s associations, or college alumni groups. You should also list charities that you make regular donations to.

5. Make Copies of Your Lists

You should make at least 3 copies of all the previously mentioned lists. You should keep one copy for yourself, provide a copy to your spouse and/or beneficiary, as well as a copy to your trustee.

6. Review Your Retirement Accounts

Retirement accounts have built in beneficiary designations. This allows such accounts to pass directly to the named beneficiary. It is important that you occasionally check that these are up to date, especially if you were recently divorced or married.

7. Update Your Insurance Policies

Like your retirement accounts, insurance policies pass directly to the named beneficiaries. Be sure that these are kept up to date.

8. Choose a Responsible Trustee

A trustee is the individual(s) you name to administer your property when you die or are incapacitated. These should be people that you trust since they have weighty responsibility.

9. Draft Estate Planning Documents

It is vital that you have certain estate documents in place. The most important document you need is a revocable living trust. A trust creates an entity that allows your assets to avoid probate. In it you name a trustee to care for the administration of your affairs. You also can name beneficiaries to which you are able to pass your funds to. Second, you need powers of attorney. These documents allow you to name agents to make health care and financial decisions if you are unable.

10. Name Accounts into Your Trust

This is an important but often overlooked step. To avoid probate your accounts must be titled into the trust. You must contact the banks you work with and have them retitle your accounts in the name of your trust.

11. Give a Copy to Your Trustee

Once you sign your trust documents, it is important that you provide them with a signed copy of your estate documents.

12. Regularly Review Your Documents

You should review your documents at least once every two years. You should especially review your documents after life changing events like divorce, marriage, or the birth of a child.

Preparing Your Estate

If you take these 12 estate planning steps before your die your estate will be in good order and provide a smooth transition for your loved ones. Meet with a qualified estate planner to get the process started as soon as possible.

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