5 Essential Documents for Your Estate Plan

7/25/2023 - By Christina Maslen and Brett Snyder, JD, LL.M

Facing our own mortality can be a tough topic to tackle, which is why estate planning is so crucial. Taking the time to plan ahead can provide peace of mind and assure that our wishes will be honored. We can decide who gets what, who takes care of the kids, and even how we want our healthcare handled. Estate planning is all about making things easier for us and our loved ones down the road.

Wondering where to begin as you prepare your own estate plan? Here are five essential documents you should consider:

Durable Power of Attorney

Let’s start with a document that grants someone the authority to make financial and legal decisions on your behalf if you become unable to do so. This could be due to an illness, accident, or any other reason. You will want to choose someone you trust ‘implicitly’ to handle your affairs responsibly. With a durable power of attorney, you can rest assured that your financial matters are in capable hands.

Advanced Medical Directive

An advanced medical directive allows you to express your wishes regarding medical treatment in case you can’t communicate them yourself. This document includes a healthcare proxy (appointing someone to make medical decisions on your behalf) and a living will (outlining your preferences for life-sustaining treatments). It’s a way to ensure that your medical choices align with your personal values.

Last Will and Testament

Oh, the good old last will and testament—a staple of estate planning. This document lays out your wishes for distributing assets after your passing. It allows you to name guardians for minor children, designate an executor to handle your estate, and ensure that your property goes to the right people. Without a will, your assets might end up in legal limbo, causing unnecessary stress for your loved ones.

Revocable Living Trust

A revocable living trust is a powerful tool for managing your assets during your lifetime and beyond. By creating a trust, you transfer ownership of your assets to it, allowing you to maintain control while avoiding probate (a time-consuming and potentially expensive legal process). It's flexible too—you can modify or revoke the trust as long as you're mentally capable. A living trust is particularly useful if you have significant assets or complex family dynamics.

Beneficiary Designations

Beneficiary designations apply to retirement accounts, life insurance policies, and other financial accounts. By specifying beneficiaries, you ensure that these assets bypass probate and go directly to the intended recipients upon your passing. Keep in mind that it is essential to review and update beneficiary designations regularly to align with any life changes or new additions to your family.

Remember, estate planning is not just for the wealthy or elderly. It’s for everyone who wants to safeguard their future and make life easier for their loved ones. Take time to plan ahead and you'll gain peace of mind knowing that you've taken care of the important details.

If you have questions about these documents or the estate planning process, please reach out to us. We can help determine which of these documents would be good for your unique situation.

About the Authors | Christina Maslen & Brett Snyder, JD, LL.M

Christina is a manager in the Tax & Accounting Services practice of Saltmarsh, Cleaveland & Gund. She has been practicing public accounting since 2008 and joined Saltmarsh in August of 2011. Christina’s primary areas of experience include the preparation of individual, trust and estate tax returns and related accounting services. Learn more about Christina

Brett is a senior in the Tax & Accounting Services practice of Saltmarsh, Cleaveland & Gund. Prior to joining Saltmarsh in January 2013, he worked as a litigation assistant and completed a five-month externship with the Mississippi Office of the Attorney General and also worked as a staff accountant for an accounting firm in Birmingham, Alabama prior to attending law school. Brett’s primary areas of experience include tax research, planning and consulting. Learn more about Brett