The Ultimate Gift to Leave Your Heirs

Did you know that 47% of adult Americans don’t have a will or trust? Dying without a will (intestate) can be a costly, complicated, sometimes messy and may take years to sort out. Then, at the end of the process, the state will decide how your assets are divided.

A detailed will or trust is the best legacy you can leave your heirs. After a death, things can get complicated and overwhelming. Shifting between grieving and untangling a messy (large or small) estate can be overwhelming.

Many reasons prevent people from talking about and actually taking the first step toward doing estate planning – procrastination (its hard work!), imagining the world without you in it, wanting to avoid hard conversations, dealing with guardianship issues or stirring up existing family grievances. At the very least, creating a basic outline of what you want to happen to your assets is better than leaving no guidance at all.

If you’re a spreadsheet lover – that’s a great place to start to collect all of the details of your assets. When you are ready for the next step consider hiring an estate attorney with in-depth knowledge of the laws of the state you reside in – but again, having something in place is better than nothing at all.

Here are some of the basic documents that you need to begin to tackle estate planning. Consider them a launching pad to encouraging family conversations and preparation.

Prior to death:
Legal Documents

– Will
Trust – Though not necessary, many people choose either revocable (changeable) or irrevocable (not-changeable), depending on family and tax situations. For 2016, the first $5.45 million of an estate is exempt from federal estate taxes, so a husband and wife would have no federal estate tax if their estate is less than $10.9 million. If an estate is above the threshold, a revocable trust may be an option.
Letter of Instruction
Power of Attorney
Health Care Proxy, HIPPAA release, organ donation
“DNR” or “Do Not Resuscitate” order (this may need to be completed upon each new hospital or nursing home stay)

Accounts
List of all bank accounts
List of all user names and passwords
List of automatic payment accounts with name and contact information of each payee
List of safe-deposit boxes
401(k), 403(b), 457(b) or any employer retirement accounts
IRA’s, Roth IRAs
Pension documents
Annuity contracts
Brokerage account information (name, contact phone number and e-mail address)
Detailed list of savings bonds (and copies of actual bonds)
Life insurance policies (private and through employer)
Long Term Care insurance policies

Other Documents
Housing, land and cemetery deeds
Mortgage accounts
Proof of loans made
Vehicle title(s)
Partnership and corporate operating agreements
Previous three year’s tax returns
Birth certificates
Original death certificates – lots of these! – most institutions want originals not copies. It is so much easier to request them from the funeral home, not after the fact from the city or state
Adoption and/or name change documents
Marriage license
Divorce papers
Military discharge information (needed for burial in a military cemetery)
List of contact information (contacts on accounts, names, current addresses and Social Security numbers of all people named in the legal documents, as well as the contact information for the estate attorney and CPA who will be handling the estate.)

When all of this hard work is done, you will then need to inform your executor/executrix where everything is stored. He/she will work with your attorney and possibly the court system to ensure that the disposition of your assets are in accordance with your wishes. And remember to review your plan as circumstances change, such as when a major life event occurs, such as marriage, birth of a child, divorce, receipt of an inheritance or a death.

There are so many moving parts to doing estate planning and organization is critical. Keeping things secure and stored in one location is a gift that your heirs will be so grateful for and one more reason for them to sing your praises!

Last Will & Testament
Image by Flickr User elrbrow