Estate planning checklist: learn the basics

What is an estate plan?

An estate plan is a set of legal and financial documents that outline how a person’s assets will be managed and distributed after their death or if they become incapacitated. Estate plans simplify probate — the legal process of validating your will and distributing your assets after death — reducing stress and the financial burden for your heirs. They may also help avoid probate entirely if assets are placed in a trust.

Who needs an estate plan?

Anyone who owns assets (such as property, businesses, and bank accounts), has dependents, or wants a say in their medical and financial decisions if they become unable to make decisions for themselves needs an estate plan.

Estate planning allows you to:

• Name guardians for your children.
• Specify how your assets will be distributed.
• Establish trusts to manage inheritance for minors or dependents with disabilities.
• Designate a trusted executor for your estate.
• Make your medical or funeral wishes known.
• Minimize tax implications for your beneficiaries.

Is estate planning the same as a will?

A will is a legal document that specifies how you want certain assets to be distributed after your death and can also name guardians for minor children. Making a will is an important part of estate planning, a process that may also include trusts, powers of attorney, advance healthcare directives, and beneficiary designations.

How to create an estate plan

To create an estate plan, define your goals, list your assets, decide who will inherit or manage them, and prepare the appropriate legal documents, such as a will or a trust. You should also organize important financial and legal records, periodically review beneficiary designations, and store signed originals securely where only the appropriate people can access them once necessary.

1. Define your estate planning goals

Start by deciding what you want your estate plan to accomplish. Your goals might include providing for your family, choosing guardians for minor children or dependents with disabilities, reducing probate complications, planning for incapacity, or specifying how and when beneficiaries receive assets.

These priorities will help determine which kind of estate plan you need. Depending on your circumstances, your estate plan may combine a will, trusts, beneficiary designations, joint ownership arrangements, and other legal documents. The right approach depends on your goals and the size and complexity of your estate.

• Wills are best for individuals with relatively simple estates who want a straightforward, low-cost legal document.
• Trusts are best for individuals who own high-value assets or have assets in multiple jurisdictions, wish to avoid probate, provide for beneficiaries with special needs, or plan for incapacity.
• Beneficiary designations are for non-probate assets such as life insurance policies, retirement funds (IRAs, 401(k)s, etc.), and payable-on-death (POD) bank accounts.
• Joint ownership arrangements are for transferring real estate or financial accounts to a surviving co-owner without probate.

A will is the baseline estate planning document. Even if you have a trust, you’ll need a pour-over will to assign guardianship to minor children and caretakers for pets, and account for any assets not held in the trust.

To determine whether you need additional types of estate planning, such as a trust, you should consider your family structure and dynamics — such as blended families, estranged family members, or dependents with special needs — and your financial, business, or charitable priorities.

2. Create an asset inventory checklist

An asset inventory is a list of everything you own. Creating one helps your executor efficiently locate and distribute your assets without unnecessary delays or costs, reduces the risk of assets being overlooked and ultimately distributed under applicable intestacy laws, and minimizes the risk of disputes over your estate after your death.

Here’s an easy-to-use estate inventory checklist to get you started:

Once you’ve completed the checklist, keep your asset inventory confidential and secure. Because it contains sensitive personal and financial information, exposure could increase your risk of identity theft, bank scams, deed fraud, and other forms of fraud. Refer to our guide for more tips on keeping your sensitive data secure when creating your estate planning checklist.

3. Assemble estate planning documents

Next, prepare the legal documents needed to put your estate plan into effect. Each serves a specific purpose, from directing how your assets are distributed after your death to specifying who can make financial or healthcare decisions on your behalf if you become unable to do so.

Here are some of the documents that make up a comprehensive estate plan:

Keep especially sensitive information in a separate private record rather than including it directly in your will or trust documents. Avoid listing full Social Security numbers or bank account numbers; instead, store these details in a secure asset inventory or encrypted digital vault.

Protecting these records matters because exposure could increase your risk of scams, social engineering, and account takeover attacks from hackers, so be sure to follow our tips for scanning sensitive documents securely when assembling your plan.

4. Designate or update beneficiaries

Beneficiaries are the people, organizations, or entities who will inherit your assets. You should consider naming both a primary and a contingent beneficiary for each asset or account in your estate inventory that allows beneficiary designations.

A primary beneficiary is the individual or organization you wish to inherit an asset, whereas a contingent beneficiary is the individual or organization who should inherit that asset if the primary beneficiary cannot receive it.

You should also name a residuary beneficiary in your will. This is the person or organization that receives property remaining in your estate after specific gifts, debts, expenses, and other distributions have been handled.

For some assets, such as life insurance, retirement accounts (IRAs, 401(k)s), and payable-on-death (POD) accounts, the beneficiary designation on the account generally determines who receives the asset, regardless of what your will says.

Additionally, if the designated beneficiary of your life insurance policy dies before you, and you have no surviving contingent beneficiary, the proceeds are generally distributed according to the specific policy’s terms. Depending on those terms and applicable law, they may become payable to your estate or distributed under intestacy laws.

Review the beneficiary designations on relevant accounts and policies every three to five years and update them after major life events, such as divorce, births, deaths, or estrangement.

5. Write a letter of instruction

A letter of instruction is a non-legal document provided alongside your will that contains information such as your funeral wishes, the location of estate planning documents, and additional context about how and why beneficiaries were designated.

It’s optional and not legally enforceable, but it can be incredibly valuable in clarifying your wishes and reducing the administrative burden on your executor. You may also wish to create more than one letter of instruction to keep useful instructions and wishes separate for different beneficiaries.

Your letter of instruction should include:

• Your full name and the date.
• The full name and contact information of your executor, attorney, and financial advisor.
• The location of your estate planning documents, birth and marriage certificates, and life insurance policies.
• Your funeral wishes, including preferences for burial or cremation, religious ceremony, or music and readings.
• Prepaid funeral arrangements, such as a burial plot or funeral home.
• Instructions for your executor to promptly notify Equifax, Experian, and TransUnion of your death and provide any required documentation to help protect your credit file from fraud.
• A designated “digital executor” responsible for managing your digital accounts, with instructions for closing accounts, deleting profiles, and handling other digital assets. As well as instructions for accessing them.

You may also wish to include personal messages to your family and friends, and context explaining your decisions about particular beneficiaries.

Keep your letter of instruction in a secure but accessible location and make sure your executor or another trusted person knows where to find it. Because the letter may contain sensitive personal and financial information, avoid leaving it somewhere where unauthorized people have access.

In particular, don’t include passwords directly in the document, as this could increase the risk of your passwords becoming exposed. Instead, store them securely in a password manager or other protected location and provide instructions for authorized access.

6. Store and share documents securely

After your estate plan is created, you must store it securely. Estate planning documents can contain a wealth of sensitive information, including names, addresses, financial details, account information, signatures, and information about your beneficiaries. If these documents fall into the wrong hands, that information could potentially be used for identity theft, fraud, or targeted scams.

And if your documents are lost or damaged, your wishes may be harder to establish or carry out. If a valid will can’t be located or proved, some or all of your estate may be distributed according to your state’s intestacy laws.

• If you created your estate plan with an attorney, you may be able to securely store original documents or copies at your attorney’s office, although availability and any associated fees will depend on the attorney or firm.
• If you created your estate plan without an attorney, consider storing the original documents in a secure, fire-and water-resistant location at home, such as a safe. It’s essential that your executor knows where the documents are and how to access them when necessary.

Think carefully before storing an original will or other essential estate documents in your bank’s safe-deposit box. Access rules after death vary by state, bank, and account arrangement, and restricted access could delay retrieval. If you use one, check the rules in advance and make sure your executor or another trusted person can access it when needed.

You can also keep digital copies in a secure online location, such as an encrypted cloud drive — they can be useful backups, but they may not replace legally required originals. Protect them with a strong, unique password and multi-factor authentication, and avoid sending sensitive estate documents through regular email. Use a secure portal or encrypted sharing method instead.

Do I need an estate planning attorney?

It’s advisable to consult an estate planning attorney if you have a complex estate, such as high-value personal property, business interests, real estate in multiple jurisdictions, children or beneficiaries with special needs, or family dynamics involving children from multiple relationships, estrangement, or conflict.

If the answer to any of the following questions is “yes,” consider consulting an attorney:

Family

• Do you want to specify how much of your estate goes to your children and your surviving spouse?
• Do you have children from multiple relationships or stepchildren you wish to provide for?
• Do you have family members with a history of financial mismanagement?
• Do you have family members with special needs you wish to provide for?

Financial

• Do you have significant or complicated debts that could affect your estate or the assets available to your beneficiaries?
• Are you worried about lawsuits or creditor claims affecting your assets or estate?
• Do you want to ensure your children or grandchildren have money for college?
• Do you want to understand or potentially reduce estate, inheritance, gift, or other tax liabilities that may apply to your estate or beneficiaries?

Business

• If you own a business, do you want it to be sold, stay in the family, or be passed to a partner?
• If your desired successor dies before you, who should take over the business?
• Is your estate liquid enough to cover applicable taxes, debts, and expenses without forcing the sale of the business?

Charitable

• Do you want to leave a portion of your estate to a charity, community or religious organization, or other cause?
• Do you want to establish a scholarship fund or foundation?
• Do you want to donate a specific amount, a percentage of your estate, or some or all of your residuary estate?

Take the next step in securing your legacy

Future planning can feel overwhelming, but you don’t have to figure out everything all at once. A great next step is signing up to receive practical information about securing your personal information through credit monitoring and identity theft protection services.

Take care of your legacy now so you don’t need to worry about your assets, your wishes, and the people you care about in the future.