The Estate Planning Documents Most People Need

Estate planning is not only for the wealthy. It is about making sure your wishes are known and your family is not left guessing. A few key documents do most of the work, and they need an occasional check-up.

Key takeaways

• Several documents work together, not just a will
• Beneficiary forms often override what a will says
• Review your papers after any major life change
• An attorney in your state should prepare legal documents

A will

A will says who receives your property and who is in charge of carrying out your wishes. If you have children who are minors, it is also where many people name a guardian. Without a will, state law decides.

Powers of attorney

A financial power of attorney names someone you trust to handle money matters if you cannot. A healthcare power of attorney, sometimes called a healthcare proxy, names someone to make medical decisions for you. Without them, your family may need to go to court.

A living will or advance directive

This document records your wishes about medical care near the end of life. It can ease the burden on loved ones who would otherwise need to guess.

A trust, if it fits

Some people use a trust to manage how and when assets pass to others, or to avoid probate. Not everyone needs one. An estate attorney can explain whether a trust fits your situation and your state's rules.

Beneficiary forms

Retirement accounts and life insurance pass to the people named on the account forms, not by your will. These forms are easy to forget. Check them after a marriage, divorce, birth or death, and confirm that the names are still the ones you want.

Taxes and your heirs

Different assets are taxed differently when they pass to heirs. Retirement accounts and other assets can have very different results. Looking at this ahead of time can help you decide which accounts to use first and which to leave behind.

• Will
• Financial power of attorney
• Healthcare power of attorney
• Living will or advance directive
• Beneficiary forms on every retirement account and policy
• A list of where your documents and accounts are kept

Sources and references

• IRS: Estate tax (opens in a new tab)
• USA.gov: Wills and estate planning (opens in a new tab)

This article is general information, not legal, tax or investment advice for your situation. Platinum Tax Advisory does not provide legal services. Talk with a qualified attorney about your documents.