12 Simple Steps to a Great Estate Plan
A checklist to help you take care of your family by making a will, power of attorney, living will, funeral arrangements, and more.
1. Make a Will: In a will, you state who you want to inherit your property and name a guardian to care for children, etc.
2. Consider a Trust: If you hold your property in a living trust, your survivors won’t have to go through probate court which can be time-consuming and expensive.
3. Make Health Care Directives: Writing out your wishes for health care can protect you if you become unable to make medical decisions for yourself. Health care directives include a health care declaration, also known as a living will as well as a power of attorney for health care, which gives someone you choose the power to make decisions if you can’t.
4. Create a Financial Power of Attorney: Also known as a durable power of attorney for finances, you can give a trusted person authority to handle your finances and property if you become incapacitated and unable to handle your own affairs.
5. Protect Your Children’s Property: You should name an adult to manage any money and property your minor children may inherit from you. This can be the same person as the personal guardian you name in your will.
6. File Beneficiary Forms: Naming a beneficiary for bank accounts and retirement plans makes the account automatically payable on death to your beneficiary and allows the funds to skip the probate process.
7. Consider Life Insurance: If you have young children or own a house, or you may owe significant debts or estate tax when you die, life insurance may be a good idea.
8. Understand Estate Taxes: Most estates — more than 99.7% — won’t owe federal estate taxes. For deaths in 2015, the federal government will impose estate tax at your death only if your taxable estate is worth more than $5.43 million. (This exemption amount rises each year to adjust for inflation.) Also, married couples can transfer up to twice the exempt amount tax-free, and all assets left to a spouse (as long as the spouse is a U.S. citizen) or tax-exempt charity are exempt from the tax.
9. Cover Funeral Expenses: Rather than a funeral prepayment plan, which may be unreliable, you can set up a payable-on-death account at your bank and deposit funds into it to pay for your funeral and related expenses.
10. Make Final Arrangements: Make your wishes known regarding organ and body donation and disposition of your body — burial or cremation. For more information, see Final Arrangements FAQ.
11. Protect Your Business: If you’re the sole owner of a business, you should have a succession plan. If you own a business with others, you should have a buyout agreement.
12. Store Your Important Documents: Your attorney or the executor of your estate may need access to the following documents. It’s important to keep them in a safe and secure place. These include your will, trusts, insurance policies, real estate deeds, certificates for stocks, bonds, annuities, information on bank accounts, mutual funds, and safe deposit boxes, information on retirement plans, 401(k) accounts, or IRAs, information on debts: credit cards, mortgages and loans, utilities, and unpaid taxes; information on funeral prepayment plans, and any final arrangements instructions you have made.
Located in Durham, NC, Integrated Life and Financial Planning is an independent financial services firm founded by Jerry Bergner, AAMS CMFC. As a Durham, NC-based Financial Planner, Jerry’s mission is to help you achieve the life YOU envision. His mission is to assist you in supporting the life you envision for yourself and those you care about. If you need help in clarifying that vision, he can work with you on that as well! Book a consultation meeting today.