Estate Planning Preparation: 5 Things Every Family Should Have in Order

Estate planning is often thought of as a collection of legal documents, such as a trust, a will, powers of attorney, and health care directives. Those documents are important, but a strong estate plan involves more than simply signing paperwork.

A well-prepared estate plan brings your assets, legal documents, and the people you have chosen to help you together in one coordinated plan. If you are just getting started, learning more about Shoup Legal’s estate planning services can help you understand the different pieces that may be included.

Taking time to get organized now can make things much easier for your family later. Here are five important areas every family should have in order.

1. Have a Clear Picture of What You Own

One of the first steps in estate planning is understanding what makes up your estate.

For many families, that includes more than a home and a checking account. Your assets may include:

• Real estate
• Bank and investment accounts
• Retirement accounts
• Life insurance policies
• Business interests
• Vehicles
• Valuable personal property
• Digital assets

You do not necessarily need to track every household item. The goal is to have a clear picture of your significant assets and where they are held.

Keeping an updated list can also make it easier to determine whether your assets are properly coordinated with your estate plan.

For example, if you have created a revocable living trust, some assets may need to be titled in the name of the trust for the trust to work as intended. Our article on how a living trust works in California provides more information about the role a trust can play in an estate plan.

2. Make Sure the Right People Are in the Right Roles

Estate planning is not only about deciding who receives your property. It also involves deciding who you trust to make important decisions and carry out your wishes.

Depending on your estate plan, you may need to choose people to serve as:

• Successor trustee
• Executor
• Agent under a financial power of attorney
• Health care agent
• Guardian for minor children

These roles come with different responsibilities, so the person who is right for one role may not always be the best choice for another.

For example, a successor trustee may eventually be responsible for identifying and managing trust assets, working with beneficiaries, paying expenses, and distributing assets according to the terms of the trust. Families can learn more about these responsibilities in our guide to trust administration.

Think about whether the people you have chosen are responsible, available, willing to serve, and capable of handling the duties involved.

It is also important to revisit these choices over time. Relationships change, people move, children grow older, and someone who made sense for a role several years ago may no longer be the best choice today.

3. Review Your Estate Planning Documents

Creating an estate plan is not something you should necessarily do once and then forget about.

Your plan should continue to reflect your current family situation, financial circumstances, and wishes.

Consider reviewing your documents after major life changes such as:

• Marriage or divorce
• The birth or adoption of a child or grandchild
• The death of a family member
• Buying or selling real estate
• Starting or selling a business
• Significant changes in finances
• A change in the people you want serving in important roles

These changes can have a significant impact on an existing plan. Our article on life events that require an estate plan update explains several situations that may be a good reason to take another look at your documents.

Even when there has not been a major event, reviewing your estate plan from time to time can help you confirm that it still reflects your wishes.

An outdated estate plan may create confusion or may no longer accomplish what you originally intended.

4. Coordinate Beneficiary Designations and Trust Funding

Some assets do not pass according to the instructions in a will or trust.

Retirement accounts, life insurance policies, and certain financial accounts may pass directly to the beneficiaries named on those accounts.

That means beneficiary designations are an important part of the overall estate planning process. It is a good idea to review them periodically to make sure they still reflect your wishes and are coordinated with the rest of your plan.

Trust funding deserves attention as well.

Creating a living trust does not automatically place every asset into the trust. Real estate and certain other assets may need to be properly transferred or retitled.

If assets are left outside the trust unintentionally, they may not be handled in the way you expected. Depending on the circumstances, assets outside of a trust may also be subject to the California probate process.

Estate planning works best when your documents, asset ownership, and beneficiary designations all support the same plan.

5. Make Important Information Easy to Find

Even a carefully prepared estate plan can create unnecessary stress if no one knows where the documents are located.

Your family or the people you have chosen to assist you should have a reasonable way to find important information if it becomes necessary.

That may include:

• Estate planning documents
• A list of major financial accounts
• Insurance information
• Real estate records
• Business information
• Contact information for attorneys, accountants, and financial advisors
• Instructions for accessing important digital information

This does not mean giving everyone access to your private financial information today.

It simply means having an organized system and making sure at least one trusted person knows where important information can be found.

In an emergency or after a death, that preparation can save family members a great deal of time, stress, and uncertainty. If a successor trustee eventually needs to step in, Shoup Legal’s trust administration services can provide guidance through the legal and financial responsibilities involved.

Estate Planning Is About Being Prepared

A good estate plan is more than a set of documents stored in a drawer.

It is a coordinated plan that identifies what you own, who you trust, how your assets should be handled, and where important information can be found.

Taking the time to put these pieces in order can make things easier for the people you care about and help ensure that your wishes are carried out as intended. As we discuss in our article on how an estate plan protects your loved ones, thoughtful planning can also provide your family with greater clarity during difficult times.

If you have not created an estate plan, or if it has been several years since you reviewed your existing plan, Shoup Legal can help you understand your options and determine whether your current documents still meet your needs.

Shoup Legal also offers free estate planning workshops for individuals and families who want to learn more about wills, trusts, probate, powers of attorney, and the estate planning process.

This article is intended for general educational purposes and is not a substitute for individualized legal advice.