A practical walkthrough of essential estate planning documents and decisions, from wills and powers of attorney to beneficiary designations and digital asset planning.
Draft a will that names beneficiaries for all major assets
About 67% of Americans don't have a will. Dying without one (intestate) means state law decides who gets your assets, which may not match your wishes. An attorney-drafted will costs $300-$1,000 depending on complexity.
Name an executor to manage your estate
Choose someone organized, trustworthy, and willing to serve. The executor handles paying debts, filing tax returns, and distributing assets, which typically takes 6-18 months. Name an alternate executor in case your first choice can't serve.
Designate a guardian for minor children
If both parents die without naming a guardian, a court decides who raises your children. Discuss your choice with the prospective guardian before naming them. Name at least one alternate guardian in case circumstances change.
Set Up Powers of Attorney
Create a durable financial power of attorney
A durable POA lets your chosen agent manage finances if you become incapacitated. Without one, your family must petition a court for guardianship, which costs $2,000-$5,000 and takes 2-6 months.
Create a healthcare power of attorney
This names someone to make medical decisions when you can't. Choose someone who understands your values and can handle stressful decisions. They should live close enough to reach a hospital quickly if needed.
Draft an advance healthcare directive (living will)
A living will states your preferences for life-sustaining treatment, resuscitation, and organ donation. Forty-two states and DC have specific living will statutes. Keep copies with your doctor, hospital, and healthcare agent.
Review All Beneficiary Designations
Update beneficiaries on retirement accounts (401k, IRA)
Beneficiary designations on financial accounts override your will. If your ex-spouse is still listed on your 401(k), they receive those funds regardless of what your will says. Review designations after every major life event.
Verify beneficiaries on life insurance policies
Life insurance proceeds go directly to named beneficiaries and skip probate. Always name both a primary and contingent beneficiary. If no living beneficiary exists, the payout goes to your estate and faces probate delays of 6-18 months.
Set up payable-on-death designations for bank accounts
Adding a POD designation to bank accounts transfers the funds directly to your beneficiary at death, bypassing probate entirely. Most banks set this up in minutes at no cost. The beneficiary has no access to the account while you're alive.
Review transfer-on-death registrations for brokerage accounts
A TOD registration on investment accounts works like POD for banks. Assets transfer to your named beneficiary without probate. Without this, brokerage assets go through your estate, which can freeze access for months.
Consider Trust Options
Evaluate whether a revocable living trust fits your situation
A revocable trust avoids probate, maintains privacy, and provides management if you're incapacitated. Setup costs $1,500-$3,000 with an attorney. Most beneficial if you own property in multiple states or have assets over $500,000.
Assess irrevocable trust options for tax and asset protection
Irrevocable trusts remove assets from your taxable estate, which matters if your estate exceeds the federal exemption ($13.61 million in 2025 per individual). They also protect assets from creditors and lawsuits but you give up control.
Plan for Digital Assets
Create an inventory of all digital accounts and assets
List email accounts, social media, cloud storage, cryptocurrency wallets, domain names, and subscription services. The average person has 100+ online accounts. Include account names but store passwords separately in a password manager.
Designate a digital executor or include digital assets in your will
The Revised Uniform Fiduciary Access to Digital Assets Act (adopted by 49 states) lets you grant fiduciary access to digital accounts. Name a tech-savvy person who can manage or close accounts, transfer cryptocurrency, and archive important files.
Set up legacy contacts on major platforms
Most major platforms offer legacy or inactive account settings. Set these up now while you have access. Without a legacy contact, families must submit death certificates and legal documents, which can take 3-6 months per account.
Write a Letter of Instruction and Schedule Reviews
Write a letter of instruction with practical details
This non-legal document tells your family where to find your will, insurance policies, account information, and safe deposit keys. Include funeral preferences, pet care instructions, and pending obligations. Update it annually.
Store all estate documents in a secure, accessible location
Keep originals in a fireproof safe or with your attorney. Give copies to your executor, healthcare agent, and financial POA. Do not keep the only copy in a safe deposit box, as access after death can take weeks without a co-signer.
Schedule estate plan reviews every 3-5 years or after major life events
Review your plan after marriage, divorce, birth of a child, death of a beneficiary, major asset purchase, or a move to a new state. State laws differ on POA requirements, so a move may require new documents.
Frequently Asked Questions
What is the difference between a will and a trust?
A will takes effect only after death and must go through probate (a public court process taking 6-18 months). A revocable living trust takes effect immediately, avoids probate entirely, remains private, and allows for incapacity planning. Wills cost $300-$1,000 through an attorney; trusts cost $1,500-$3,000 but save heirs $5,000-$50,000+ in probate costs and months of waiting.
At what age should I start estate planning?
Every adult over 18 should have at minimum a healthcare power of attorney and HIPAA authorization. Once you have dependents, own property, or accumulate assets above $100,000, a full estate plan (will, POA, healthcare directive) becomes urgent. By your 40s, or whenever your estate approaches the federal exemption threshold ($13.61 million in 2024), consider adding trusts and tax planning strategies.
What happens if I die without a will?
Dying intestate means your state's default inheritance laws determine who receives your assets, which often does not match your wishes. In most states, a surviving spouse does not automatically inherit everything; children receive a share, and unmarried partners receive nothing. The court appoints an administrator (potentially someone you would not have chosen), and the process takes 1-3 years with higher legal costs.
How often should I update my estate plan?
Review your estate plan every 3-5 years and immediately after major life events: marriage, divorce, birth of a child, death of a beneficiary or executor, significant change in assets, or moving to a different state. State laws governing estates vary significantly, so a plan drafted in California may not work as intended if you relocate to Texas. Most attorneys charge $200-$500 for routine updates.
Do beneficiary designations override a will?
Yes. Beneficiary designations on retirement accounts (401k, IRA), life insurance policies, and transfer-on-death accounts take legal precedence over whatever your will states. This is one of the most common estate planning mistakes: someone updates their will after a divorce but forgets to change the beneficiary on a $500,000 life insurance policy, leaving the ex-spouse as the legal recipient.