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Written by: Derek Melvin

Estate planning is one of the most important steps you can take to protect your family, your finances, and your legacy. It is also the hardest topic to discuss in a personal financial plan, as you are planning for how your assets and wishes will be carried out post-death.

No matter what stage in life you are in, having a clear and comprehensive estate plan can bring peace of mind and ensure your wishes are honored after your death—or if you become incapacitated.

This guide outlines five critical areas to focus on when making end of life preparations to your estate plan, including wills and trusts, powers of attorney, beneficiary designations, and more.

1. The First Step to an Estate Plan is a Will

The first building block of any estate plan is a will. A will allows you to specify how your assets should be distributed, name a guardian for your minor children, and choose an executor to manage your estate after death. Without a will, your estate will be settled according to your state’s intestacy laws. This can lead to the state determining how your assets and wishes are passed down, which can differ significantly from your personal wants.

Key elements of a will:

  • Executor designation: This is someone named to manage and distribute your   assets according to the will’s instructions. Name someone you trust to oversee your estate and follow your instructions.
  • Guardianship for minors: Choose a person to care for your children if both parents pass away.
  • Asset distribution: Outline who will receive your belongings, property, and other assets.

Having a valid will ensures clarity, avoids probate disputes, and saves your family from unnecessary stress during an emotional time.

Each state’s estate planning laws differ, so it is important to have an estate planning attorney who knows the laws of your resident state.

    

2. Understanding Trusts

Wills and trusts are often discussed together in the estate planning process, but they serve different purposes. A trust allows you to manage how your assets are distributed while avoiding probate, reducing taxes, and keeping your estate private. For example, a trust can ensure a family home passes smoothly to children without court involvement or public disclosure. Or allowing an investment account to be transferred to your beneficiary in a timely manner, without freezing the account during probate.

Trusts are more complex (and more expensive) than wills. There are nearly infinite different kinds of trusts, all created to accomplish different things. Some can be amended over time. Others are set in stone and considered irrevocable. Below are a few common types of trusts, but speaking to an estate planning attorney to determine what trust is best for your financial situation is important.

Common types of estate planning trusts:

  • Revocable Living Trust: Keeps control in your hands during your lifetime and allows for seamless asset transfer after death.
  • Irrevocable Trust: Helps shield assets from creditors and may reduce estate taxes but cannot be modified easily.
  • Special Needs Trust: Protects benefits for individuals with disabilities while still providing financial support.
  • Charitable Trust: Allows you to donate to causes you care about while reducing estate tax liability.

Using trusts as part of your estate planning strategy can save time, money, and legal hassle for your heirs.

3. Plan for Incapacity with Powers of Attorney and Living Wills

Estate planning is about more than what happens when you die—it also includes planning for the possibility of serious illness or incapacity. Without the proper documents, your loved ones may have to go to court to make decisions on your behalf when incapacitated. This also leaves room for arguments amongst family members about who makes decisions on your behalf. Having a power of attorney is a critical component of any comprehensive estate planning checklist.

Essential incapacity planning documents include:

  • Healthcare Power of Attorney: Authorizes a trusted person to make medical decisions for you if you are unable to do so.
  • Financial Power of Attorney: Allows someone to manage your finances, pay bills, and handle legal matters on your behalf.
  • Living Will: Clearly outlines your preferences for end-of-life care.

Adding these documents to your estate plan ensures your wishes are followed and reduces the burden on family members during emergencies.

4. Update Your Beneficiaries and Review Account Ownership

One of the most overlooked estate planning mistakes is failing to update beneficiary designations. Many assets, including retirement accounts, life insurance policies, and investment accounts, are transferred outside of your will and directly to beneficiaries’ post-life.

To keep your estate plan current:

  • Review and update beneficiary designations regularly, especially after life changes like marriage, divorce, or the birth of a child.
  • Use Transfer-on-Death (TOD) or Payable-on-Death (POD) designations for bank and investment accounts.
  • Coordinate account titling with your estate planning goals. Joint accounts, for example, pass directly to the surviving owner, regardless of your will.

If you have a trust, you will want to speak with your estate planning attorney to see if they recommend listing that as a beneficiary on life insurance policies, retirement accounts, etc.

5. Minimize Estate Taxes and Leave a Lasting Legacy

A truly effective estate planning strategy also addresses the financial side of death. Without planning, estate taxes, debts, and court costs can significantly reduce what you leave behind.

What to consider:

  • Federal Estate Tax: As of 2025, estates valued under approximately $13 million (per individual) are exempt from federal estate tax, but state-level taxes may still apply.
  • Income Taxes on Inherited Retirement Accounts: Heirs to IRAs or 401(k)s may be subject to income tax under the SECURE Act’s 10-year withdrawal rule.
  • Charitable Giving: Leave a portion of your estate to charity to reduce your taxable estate and support causes you care about.
  • Debt Management: Your estate is responsible for settling outstanding debts before assets are distributed. Planning can help reduce liabilities and simplify the process.

Beyond money, legacy planning includes passing down values, stories, and personal history. Writing letters to loved ones or recording family traditions can be as meaningful as financial gifts.

6. Simplify Your Investment Accounts (If Possible)

This is especially true if end of life is imminent. As you prepare and update your estate plan, it also may be helpful to consolidate investment accounts and other assets.

For example, if you have six different investment accounts at six different investment firms, it may be simpler for your estate plan to have these accounts consolidated. If you are working with multiple financial advisors, same thing here. It may be easier for the transfer of assets post-death if you consolidate accounts with one firm.

Working with a financial advisor can be helpful in these situations. If you would like to schedule an initial meeting with one of our advisors, please reach out to us.

Final Thoughts: Start Your Estate Planning Journey Today

Estate planning is not just about dying—it is about living with peace of mind. Whether you have a modest estate or significant wealth, putting a plan in place gives you control over your future, protects your family, and prevents avoidable legal issues.

Estate planning checklist summarized:

  1. Draft or update your will.
  2. Consider setting up trusts if appropriate.
  3. Assign powers of attorney for healthcare and finances.
  4. Review all beneficiary designations and account titles.
  5. Work with an estate planning attorney and financial advisor to minimize taxes and maximize your legacy.
  6. Consolidate investment accounts to simplify your finances.

By investing time in creating a personalized, well-thought-out estate plan, you are giving your loved one’s clarity and confidence.

 

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