Estate Planning Checklist

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Estate Planning Checklist: Minimizing Anxiety and Confusion for Your Loved Ones

Wills, health care directives, powers of attorney. By now, most people know they should prepare these items, even if they haven’t yet, and make them available to trusted family members before the unthinkable—yet inevitable—happens. The information family and friends will need when a loved one dies goes far beyond those much-talked-about documents, and having that information available can make the end of life just a little less painful for those who remain.

End-of-life planning is often a difficult topic to discuss, especially with your family. However, without proper estate planning in place, many families can be left in the dark during a challenging time. These decisions impact more than investments and assets, they also matter when it comes to unforeseen health issues.

Understanding the full extent of these obligations and preparing in advance with family and advisors can ease administrative burdens and reduce anxiety during an extremely emotional time. Here are some helpful estate planning steps to consider for your peace of mind.

Collect Relevant Documents

First, gather all the necessary documents. These should include the title to physical assets, deeds to properties, birth and marriage certificates, and burial plot information. You should also gather any estate planning documents currently in place, such as wills, trusts, financial and medical powers of attorney, as well as life insurance policies and information on retirement account beneficiaries. Also, be sure to have the name and contact information for your doctors, lawyers, accountants, financial advisors and insurance brokers. Having all the important documents ready and making sure your family knows where they are and how to access them will also help streamline the estate planning process. Important estate planning documents to consider:

  • Will/Trust
  • Durable power of attorney
  • Health care power of attorney
  • Beneficiary designations
  • Letter of Intent/Wishes
  • Advance medical directive
  • Asset inventory (including digital)

Secure Your Digital Assets and Documents

Many people are fully digital, which means very few people have the passwords to access your accounts—or even know where your accounts are located. Choose a person who will have access to your account information—not just on banking and investment accounts, but bill pay, social media, emails, frequent-flier miles, online photos, domain names, virtual currency and many more. These items may have great sentimental value as well as monetary value that can generate revenue for your heirs. Define your digital assets in your estate planning document and indicate to whom they should go and what can be deleted. Consider who should have the authority to deal with service providers controlling your digital assets in your powers of attorney, will and revocable trust.

Having copies of all your important documents is critical. It is also important to store paper documents—such as in a fire-proof safe—where a trusted person has access. You can also make electronic copies of documents that are sent to advisors and loved ones.

Visit an Estate Attorney and/or Financial Planner

While you may think that you have covered all your bases, it may be a good idea to consult with your advisors to review your estate and financial plans. As you get older, your needs may change, such as determining if you need long-term care insurance and protecting your estate from a large tax bill or lengthy court proceedings. Professionals will also be current on changes in legislation, and income tax and estate tax laws, which could impact your plan, as well.

Before meeting with a professional planner, consider your initial goals, hopes and desires. For instance, in the years ahead, what do you want to accomplish? Do you want to create a business? Sell a business? Do you want to travel the world, build a home or pay for your grandchild’s education? Next, think of what you want your wealth to accomplish after your death. For example, do you want to leave all your money to your children to do with as they want, or do you want to control their access so that your legacy extends beyond just the next generation? Do you want to leave money to a charity?

Ensure You Have a Will

Creating a will is one of the most important things you can do when it comes to estate planning. A will addresses how you would like your property to be distributed and who is going to oversee managing your estate. If you don’t make a will, you are leaving decisions up to the estate laws of the state where you live, and the result could differ from your intentions.

Once your will is finalized and signed, make sure that your estate administrator gets a copy. If the original is not being kept in your home (for example, it is at your attorney’s office), you should also keep a copy in a safe place at home. Finally, make sure that all the concerned individuals have copies of these documents.

Create a Revocable Living Trust

A revocable living trust can help ensure that your assets are distributed efficiently to your beneficiaries in the manner you’ve outlined. A revocable trust can also protect you in the event you are declared incompetent to handle your financial and/or personal affairs.

A revocable trust allows you to keep control over property that is placed within the trust during your lifetime. A corporate fiduciary may be a prudent solution to serve as a successor trustee, as they have the expertise and knowledge to manage the trust upon your death. If all your assets are held in the trust at your death, asset distribution should run smoothly, which may avoid probate and save angst, time, and money.

Name an Agent or Attorney-in-Fact through a Power of Attorney

A power of attorney names the person who is going to make decisions for you in case you cannot make them for yourself. This could be a durable health care power of attorney to cover health care decisions and a durable financial power of attorney to cover financial decisions.

You can also write a letter of instruction to leave step-by-step instructions that spell out your wishes for things like your funeral or what to do with your digital assets, such as social media accounts. If you are married, each spouse should create a separate will, with plans for the surviving spouse.

Create a Living Will

It is also essential to create a living will, also known as an advance directive. Unfortunately, medical emergencies happen, and in the event you are incapacitated or unable to make decisions, a living will can express your desires on end-of-life treatment preferences. A living will should also address your preferences on the continuation or discontinuation of medical treatment, including breathing or feeding tubes. Provide a loved one or your estate administrator with the information on what should happen immediately after your death. That should include your funeral or cremation plans and potential organ donor designation, as well as any payable on death accounts that would help defray funeral costs.

You can also include a Health Insurance Portability and Accountability Act (HIPAA) authorization, which allows your chosen representative to speak with health care professionals about your private and protected medical records.

Consolidate Your Finances

If you have changed jobs over the years, it is quite likely that you have several different retirement plans with past employers. You may want to consider consolidating these accounts into one individual IRA. Consolidating accounts generally allows for better investment choices, lower costs, less paperwork, and easier management.

Check Your Beneficiaries

Always check your plans to ensure your beneficiaries are up to date, especially if you lose a spouse, or get divorced, or remarried. Remember, your will does not control who the beneficiaries are on your life insurance, pensions or retirement accounts. In fact, designated beneficiaries override a will, so both should reflect your current wishes. It is important to review your beneficiary designations from time to time.

Review Frequently

Review your will/estate plan for updates at least once every two to five years and after any major life-changing events (marriage, divorce, birth of a child, etc.). Life is constantly changing, and your assets and wishes are likely to change from year to year. Many people run into problems when it’s discovered they haven’t updated their documents in years.

Communicate With Family and Fiduciaries

While it is important to gather all the necessary forms and create new documents, it is also crucial to speak about your wishes with your loved ones. It might be a hard conversation, but it is for the best, to ensure everyone is on the same page and your plans are followed.

Discussing your wishes regarding art, jewelry and other tangible assets with family members or drafting a letter that outlines your preferences can avoid confusion and disagreements and can often be more efficient than creating a formal list within a will. Consult with your attorney as to which course of action is prudent in your state.

Speak with named fiduciaries about the details of their roles, and make sure they are comfortable with handling the many responsibilities.

How Comerica Can Help

When it comes to estate planning, it is always a good idea to have a team of advisors to help. You can consult with an estate planning attorney, your wealth advisor and your accountant to make sure all your questions are answered, and your documents are prepared. Our team of Comerica Trust professionals can also assist with any questions that you may have regarding trustee and executor services. When we serve as executor or trustee, our approach is comprehensive and guided by our commitment to fulfill your final wishes with utmost integrity, fairness and consideration, for all beneficiaries.

Estate planning can be stressful but having a plan in place ahead of time can help ensure your family is taken care of and your wishes are met exactly as you intended. 

To learn more how Comerica Trust can provide further guidance on trust and estate solutions, please visit: www.comerica.com/advisorsolutions.



NOTE: IMPORTANT INFORMATION

This is not a complete analysis of every material fact regarding any company, industry or security. The information and materials herein have been obtained from sources we consider to be reliable, but Comerica Wealth Management does not warrant, or guarantee, its completeness or accuracy. Materials prepared by Comerica Wealth Management personnel are based on public information. Facts and views presented in this material have not been reviewed by, and may not reflect information known to, professionals in other business areas of Comerica Wealth Management, including investment banking personnel.

The views expressed are those of the author at the time of writing and are subject to change without notice. We do not assume any liability for losses that may result from the reliance by any person upon any such information or opinions. This material has been distributed for general educational/informational purposes only and should not be considered as investment advice or a recommendation for any particular security, strategy or investment product, or as personalized investment advice.

Comerica Wealth Management consists of various divisions and affiliates of Comerica Bank, including Comerica Bank & Trust, N.A.; Comerica Securities, Inc.; and Comerica Insurance Services, Inc. and its affiliated insurance agencies. Comerica Securities, Inc. is a federally registered investment advisors. Registrations do not imply a certain level of skill or training. Comerica Bank and its affiliates do not provide tax or legal advice. Please consult with your tax and legal advisors regarding your specific situation.

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Comerica Wealth Planning is committed to working with you to help you achieve your goals by developing tailored plans based on your goals and needs, today and tomorrow, giving you a more unbiased view of your complete financial picture.

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