Estate Planning Basics: A Complete Checklist to Protect Your Client

A shocking 60% of Americans don't have a will or an overall estate plan in place.

No matter your client’s age, gender, health, or current financial situation, not having a legally-binding plan for what will happen to your client’s assets and property after his or her death, is easily avoidable.

Not only will it make it difficult for the people your clients love to be properly taken care of, not having an estate plan will also likely lead to remaining loved ones paying higher estate taxes.

So, what should you do to make sure your client's estate plan is in good shape?

Start by reading this checklist of the most important estate planning basics. What do you need to inform your clients about?

1. Gather The Right Paperwork

What is the first step in understanding estate planning basics and ensuring that, after your client passes away, the property and money goes to the right people and places?

Begin by gathering the necessary paperwork.

Make sure that you have physical copies of:

  • Client birth certificate
  • Any life insurance policies
  • Any deeds/property titles
  • Buy/sell business agreements
  • A list of client debts
  • Client checking/saving account statements
  • Any investment accounts
  • Any retirement plan/benefits
  • Client’s social security card
  • Prenuptial agreement

Remember, when it comes to estate planning, it's always better to be safe than sorry.

2. Designate A Beneficiary

Another crucial step in estate planning basics?

Making sure that your client has properly designated his or her beneficiaries, e.g.,  the people/person that will receive those assets once upon passing away, is critical.

The last thing in the world you want is for the people a client cares about the most in the world to be left out in the cold after his or her death because of an improperly designated beneficiary--or one(s) not recently included/excluded due to family circumstances.

Even if your client’s money ends up with who it was supposed to go to,  loved ones will still have to sit through the expensive and time-consuming process of probate court without a properly listed beneficiary.

Always make sure that your client’s beneficiary is the same in both the will and on any investment, bank, or retirement accounts. Usually, if there is an inconsistency in this naming convention, the beneficiary form will overrule the beneficiary listed in the will.

Consistently review these beneficiary forms with your client to ensure everything is in order.

3. Consider A Living Will

When it comes to estate planning basics, many people make the mistake of assuming that everything they've set up will only come into play once they've passed away.

However, be aware that if your client becomes mentally or physically incapacitated-- to the point that effective communication and/or decision making is inhibited--he or she needs to have options.

You can outline your client's wishes in what's called a living will.

Unfortunately,  over two-thirds of Americans are without a living will. Regardless of age or current health, this is something they need to handle immediately.

You simply never know when something could happen; as a professional, you want to ensure that a client's assets and property directions are followed as well as his or her medical wishes. For example, does your client prefer to remain on life support?

4. Appoint A Power Of Attorney

It's also crucial that a client select a financial power of attorney when it comes to the estate. This designated person will manage financial decisions if your client becomes incapacitated/ passes away.

In some cases, this financial power of attorney is applicable even if your client is still alive and mentally sound. Sometimes it just means your client is allowing someone else the ability to manage those financial decisions.

Now, about the living will that we mentioned above...

Keep in mind that, in addition to a financial power of attorney, your client can also designate a healthcare power of attorney.

A person designated as the healthcare power of attorney will be responsible for putting your client's medical wishes, as stated in a living will, into practice in the event that he or she becomes incapacitated.

5. Create A Last Will And Testament

Creating an actual last will and testament is one of the most important estate planning basics.

This can outline your client's desired funeral arrangements, make it clear what will happen to any children, and of course, designate your client's beneficiaries. This document will also designate who will become the executor of your client's estate, e.g.,  the person who will work to put your client's wishes into practice.

Keep in mind that, in addition to a last will and testament, your client might also want to consider creating a living trust.

If your client has several beneficiaries, or if the estate is especially large, a living trust will help ensure that everything is quickly distributed according to the deceased’s wishes. It will also help you keep the amount of estate taxes beneficiaries are charged at a more manageable level.

Additionally, a living trust will help heirs avoid having to go into probate court.

Need Help Managing These Estate Planning Basics As An Attorney?

We hope that this list of estate planning basics has helped to clear up any confusion while you work to ensure that everything is in order for your client’s end of life decisions.

We know that, while these basics can be difficult to manage for everyday people, they can also be a challenge for attorneys.

In addition to making sure you've filed and stored the proper paperwork, attorneys also need to ensure that clients can actually understand the forms they're completing.

We can help.

Spend some time on our website to learn more about how Beyond Counsel can help you to stay organized, streamline client communications, and keep the process of estate planning as stress-free as possible.

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  • 3 Bethesda Metro Center, Suite 500, Bethesda MD

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