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Important Documents for Estate Planning

documents for estate planning

When you think of “estate planning,” you might picture yourself spending endless hours in a lawyer’s office, sifting through stacks of papers, and struggling to understand complex legal terms. However, thanks to online resources, the process of preparing documents for estate planning has become much easier and less time-consuming. In fact, taking the time to plan your estate is one of the most considerate things you can do for the people you care about.

But what exactly is estate planning? Simply put, it involves making decisions about who will receive your assets and managing your estate after your death. As a crucial part of this process, there are several important legal documents that you should have in place. In this article, we will delve into each of these documents, explaining their significance and outlining how you can obtain them.

Estate Planning Checklist

1. Last Will and Testament

You can specify who will inherit certain assets or property in your will. This includes both your tangible assets such as real estate and intangible assets like investment and bank accounts. Your beneficiaries are the people who will receive your assets. These beneficiaries can be family members, friends, or nonprofits that are important to you.

You can name guardians for your minor children or pets in your will. Additionally, you can choose an executor to fulfill your wishes. You can help ensure that your loved ones and causes are cared for after you die by making a will

2. Revocable Trust for Living Assets

A revocable trust, which is similar to a will that allows you to distribute your assets upon your death, is legal. A revocable trust allows you to control and use the property that you have put into it.

Revocable living trusts require more maintenance than wills, but they allow your assets to avoid probate. Assets in a revocable trust can be quickly distributed to your heirs after you die.

First, create and sign a trust document. You will also name a successor trustee to manage the trust in your death. After signing the document, your property should be transferred to your trust.

If you own a large estate or business, you may prefer to create a revocable trust. Revocable living trusts can be a good option in states such as California, where the probate process is lengthy and costly. 

3. Designation of Beneficiaries

Certain assets can be transferred directly to beneficiaries after your death, instead of going through probate (the court-supervised legal process for distributing your assets). These assets are known as non-probate assets. They include 401(k), pensions, and life insurance policies.

These assets must be transferred to a third party.

Non-probate assets are not subject to probate so you should not list them in your will. Beneficiary designations can override the will’s contents, so it is important to keep them up-to-date. 

4. Advance Healthcare Directive (AHCD / Living Will)

An advance directive allows you to outline how you want decisions made regarding your medical care in the event that you are unable to do so. An AHCD document typically has two parts: a living will or a medical power-of-attorney.

A living will allow you to outline your medical care preferences for the event you are unable. These preferences could include medication, treatment options, and surgical procedures.

A medical power-of-attorney allows you to choose someone (called your healthcare agent) to make your healthcare decisions for you if you are unable to. Your agent could, for example, take over healthcare decisions if your condition is severe. You can plan ahead with AHCDs by stating your medical preferences in advance for someone who cannot.

5. Financial Power of Attorney (POA)

A financial power-of-attorney can be used to give someone legal authority to manage your property and finances. These tasks include managing your real property, paying bills, and making bank deposits.

Your financial agent may also be able to use your assets to help you pay your bills and provide support for your family if you become incapacitated. You can have your healthcare agent and financial advisor work together to ensure you are able to afford the care you need.

6. Financial Information and Insurance Policies

It is a good idea for all insurance policies to be kept together. A list of all financial accounts should be kept, along with instructions for accessing them. This list includes bank accounts, credit cards, loans, mortgages, and tax returns. It also includes pension plans, retirement benefits, and investment portfolios. This information can be stored in Excel or written in a notebook. Keep it with your estate planning documents.

7. Documents Proving Identity

Your executor will be more helpful if all of your identity documents are in one place. This includes your Social Security card, birth certificate, marriage and divorce certificates, prenuptial agreements, divorce settlements, and any Armed Forces discharge papers.

8. Titles and Property Deeds

You must ensure that you have all the necessary title and deed documents. This applies to homes, vehicles, as well as other real estate. To avoid probate, you must transfer any property you own to a revocable trust. The trust should be listed as the current owner in your titles and deeds.

Remember that deeds and titles can override your will. If your spouse is listed on the deed as a joint owner, and they are still living when you die, they will legally be the legal owner of the house.

9. Passwords and Login Details for Digital Accounts

An average person under 70 years old has approximately 160 digital accounts. You can help manage them by using a password manager, or digital vault. These platforms track your login information for all of your online accounts. It is becoming increasingly popular to name a digital executor within your will. After your death, a digital executor will distribute your digital assets and close or manage digital accounts.

10. Funeral Wishes and Instructions

This allows your loved ones to know where and how you would like to be buried. You can also outline any other wishes. This includes passages that you would like to be read at your funeral or memorial donations that you wish to make to your favorite charities.

Funeral instructions, unlike many other items on the list, are not legal documents. There is no legal form that you have to fill out or have notarized. 

What Do You Do With Your Documents?

After you have completed your estate planning documents, make sure they are safe and easily accessible. Tell your family where the documents are. Give a copy to anyone who might need it. For example, your healthcare representative should be given a copy of your advance healthcare directive.

Your life changes constantly, so your estate plan must change with it. Every three to five years, whenever you experience a major life event such as getting married or purchasing a house, it is a good idea to review your estate plan.

You may need to consult a California estate planning attorney if you have any questions regarding your estate and situation.

Our team of experienced attorney can provide you with the legal guidance and support you need for all your estate planning needs. Don’t wait until it’s too late, take control of your estate today by scheduling a consultation with us. Contact Tenina Law now and let us help you protect your assets and secure your future.

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