NerdWallet Estate Planning Basics: A 7-Step Checklist
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NerdWallet Estate Planning Basics: A 7-Step Checklist
Explore NerdWallet's comprehensive 7-step checklist guide for estate planning basics. Ensure your assets and beneficiaries are well-secured and managed.
1
Identify your assets
2
Calculate the total value of your assets
3
Identify your beneficiaries
4
Approval: Beneficiary Details
5
Assign a guardian for minor children if necessary
6
Designate your decision makers
7
Create a will
8
Approval: Will Document
9
Create a living will and power of attorney
10
Approval: Living Will and Power of Attorney Document
11
Avoid probate if possible
12
Consider a trust
13
Secure your digital assets
14
Get a life insurance policy
15
Approval: Life Insurance Policy Details
16
Keep your estate planning documents safe
17
Inform trusted person about the location of your estate planning documents
18
Review and update your estate plan regularly
19
Approval: Overall Estate Plan
20
Seek professional advice if necessary
Identify your assets
In this task, you will identify all of your assets. This includes any properties, investments, bank accounts, valuables, and other possessions that you own. By identifying your assets, you will be able to understand the value of your estate and plan accordingly. Take a moment to think about any assets that you may have overlooked. What items do you need to include in your estate plan?
Calculate the total value of your assets
Now that you have identified your assets, it's time to calculate the total value of your estate. Add up the value of each asset that you listed in the previous task. This will give you an idea of the overall worth of your estate. Remember to consider any outstanding debts or liabilities that may affect the value of your estate. What is the total value of your assets?
Identify your beneficiaries
Your beneficiaries are the individuals who will inherit your assets once you pass away. In this task, identify who you want to include as beneficiaries in your estate plan. Consider your family, friends, and any charitable organizations that you would like to support. Make a list of the names of your beneficiaries. Who are your beneficiaries?
Approval: Beneficiary Details
Will be submitted for approval:
Identify your beneficiaries
Will be submitted
Assign a guardian for minor children if necessary
If you have minor children, it's important to assign a guardian who will care for them in the event of your death. Consider who you trust to raise your children and provide for their wellbeing. Communicate with potential guardians to ensure they are willing and able to take on this responsibility. Who will you assign as guardian for your minor children?
Designate your decision makers
In this task, you will designate decision makers who can act on your behalf in case you become incapacitated. These decision makers will have the authority to make medical and financial decisions on your behalf. Choose individuals who you trust and make sure they are aware of your wishes. Who will you designate as your decision makers?
Create a will
Creating a will is a crucial step in the estate planning process. A will outlines how your assets should be distributed after your death and allows you to name an executor who will carry out your wishes. Consult with an attorney or use an online service to create a legally valid will. Have you created your will?
1
Yes
2
No
Approval: Will Document
Will be submitted for approval:
Create a will
Will be submitted
Create a living will and power of attorney
A living will and power of attorney allow you to make decisions about your medical care and appoint someone to make healthcare decisions on your behalf if you are unable to do so. These documents ensure that your wishes are followed in the event of incapacity. Have you created a living will and power of attorney?
1
Yes
2
No
Approval: Living Will and Power of Attorney Document
Will be submitted for approval:
Create a living will and power of attorney
Will be submitted
Avoid probate if possible
Probate is the legal process through which a deceased person's assets are distributed. It can be time-consuming and expensive. In this task, explore ways to avoid probate, such as creating a trust or jointly owning property. Research and consider the best options for your situation. How do you plan to avoid probate?
1
Create a trust
2
Jointly own property
3
Transfer assets to beneficiaries
4
Name beneficiaries on accounts
5
Other
Consider a trust
A trust is a legal arrangement that allows you to transfer your assets to a trustee who will manage and distribute them according to your instructions. Trusts can provide added control, privacy, and flexibility in estate planning. Consult with an attorney to determine if a trust is appropriate for your needs. Have you considered creating a trust?
1
Yes
2
No
Secure your digital assets
Digital assets include online accounts, emails, social media profiles, and digital files. It's important to secure and manage these assets as part of your estate plan. Make a list of your digital assets, create a plan to protect them, and consider appointing a digital executor to handle them after your death. How do you plan to secure your digital assets?
Get a life insurance policy
A life insurance policy can provide financial security for your loved ones after your death. Evaluate your insurance needs and consider purchasing a policy that will cover your outstanding debts, funeral expenses, and provide for your dependents. Have you obtained a life insurance policy?
1
Yes
2
No
Approval: Life Insurance Policy Details
Will be submitted for approval:
Get a life insurance policy
Will be submitted
Keep your estate planning documents safe
Estate planning documents, such as your will, trust, and power of attorney, should be kept in a secure location. This will ensure that they are not lost, damaged, or accessed by unauthorized individuals. Consider using a safe deposit box or a fireproof safe to store your documents. Where do you plan to keep your estate planning documents?
Inform trusted person about the location of your estate planning documents
To ensure that your estate planning documents can be easily located when needed, it's important to inform a trusted person about their location. This person should know where to find your documents in case of an emergency or after your death. Who will you inform about the location of your estate planning documents?
Review and update your estate plan regularly
An estate plan is not a one-time event. It should be reviewed and updated regularly to reflect changes in your assets, family situation, and personal wishes. Schedule a periodic review of your estate plan to ensure that it remains up to date. How often will you review and update your estate plan?
1
Yearly
2
Every 3 years
3
Every 5 years
4
Only when major changes occur
5
Other
Approval: Overall Estate Plan
Seek professional advice if necessary
Estate planning can be complex, and it's important to seek professional advice if you have any questions or concerns. An attorney or financial advisor can provide guidance and help you navigate the estate planning process. Do you plan to seek professional advice?
