Discussing dataI recently attended an estate planning client event where I had the opportunity to mingle with the attendees afterwards. A married couple, whom I’ll name Joe and Mary, approached me. Joe took the lead, asking questions regarding “estate tax havens” and “investment plans for when we arrive in our 80s.” The questions were very vague and as he asked, I noticed he hesitantly looked at his wife, almost as though he didn’t want to hurt her feelings. Having been through this scenario before, I innately knew what the heart of the issue was: fear of the Big D discussion. Death. 

Though it’s not a topic anyone looks forward to, it’s paramount that this discussion be held so you can take care of yourself as well as the ones you love. Estate planning is a critical piece of your overall financial planning. It provides a clearer picture for blended families, especially when it comes to dividing money piles of “mine,” “yours” and “ours.” Estate planning allows you the opportunity to formally tap a family member or friend to raise your children should something happen to you and your spouse or partner. It carries out your wishes far after your passing. And financially, it can greatly minimize estate taxes. 

The estate planning process doesn’t have to be a burden. Here are four easy-to-implement steps to create and maintain an estate plan that will help provide you and your heirs with greater financial confidence.

1. Take Inventory. You need to know exactly what you’ve got before you can make a plan for what to do with it. An inventory of your estate—everything you own and owe—will help you make smart decisions about your assets and make things easier and less costly for those people who will one day be tasked with handling your affairs.

To start, gather and document the following information:

  • The value of your home and any other real estate, cars, jewelry and other personal property
  • Recent bank, brokerage and retirement account statements
  • All insurance policies, their cash values and death benefits
  • All liabilities—including mortgages, lines of credit and other debt

2. Make a plan. Estate settlement rules vary from state to state and can get complex, so it’s best to work with an experienced estate planning attorney when making your plan. Even if you choose to design your own plan, you’ll want to have a professional review done to ensure that it’s set up accurately.

To prepare for your first meeting with your attorney, answer these important questions to determine your estate planning preferences:

  • Who do you want to manage your financial affairs if you become incapacitated?
  • Who do you want to inherit your assets, and in what proportions?
  • Who should be responsible for distributing your assets to your chosen beneficiaries?
  • Who do you want to care for your minor children (if applicable)?
  • How much is needed for your children’s care and education (if applicable)?

3. Put your plan into action. An estate planning attorney will craft an estate plan that reflects your wishes and meets state and federal laws. This plan will likely consist of a will that directs how your assets will be distributed at death, as well as medical and financial powers of attorney documents that spell out who will make financial and health care decisions if you can’t. It also may include trust documents to manage the distribution of certain types of assets. 

Tip: If you do set up a trust, fund it right away. Otherwise, the agreement won’t take effect, and your assets may not pass to your beneficiaries as intended.

An attorney also can help you with any key issues that you’re unaware of or may have overlooked. For example, a professional review might reveal that you need to update your beneficiaries or retitle your assets. (You can also get help from your financial advisor with asset titling and beneficiary designations on your investment accounts.)

4. Update your plan regularly. Estate planning is not a “set it and forget it” one-time event. You’ll want to review your plan regularly to ensure that it continues to reflect your wishes—especially in the wake of any new major developments that occur in your life, such as significant investments like purchasing a home, and family situations like births, deaths, marriages and divorces.

Example: As the years go by, you may find the need to update your beneficiary designations or other key pieces of information to ensure that your assets go exactly where you want them to go. What’s more, tax laws change, and you’ll want to be sure your plan is in line with current estate tax rules and regulations.

Jennifer Furste Robinson, Certified Wealth Strategist, is a Managing Director at Charles Schwab with over 23 years of experience of leading financial professionals in helping their clients achieve their financial goals. She is a recipient of 2015 Professional Businesswomen of California Industry Leader Award, currently serves as an executive board member of Arizona Women’s Leadership and is a volunteer with Boys and Girls Club, mentoring the future female CEO’s of 2025 and beyond. Some content provided here has been compiled from previously published articles authored by various parties at Estate planning worksheetSchwab.

Information presented is for general informational purposes only and is not intended as personalized advice. Employees of Charles Schwab & Co., Inc. are not estate planning attorneys and cannot offer tax or legal advice, or create and prepare legal documents associated with such plans.  Where such advice is necessary or appropriate, please consult a qualified legal or tax advisor.