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  • Writer's pictureJohn J. Diak, CFP®

10 Smart Tips for Getting Organized with Estate Planning

Estate Planning Checklist

Estate planning is something many people tend to put off as long as possible because most of us consider discussing “the end” an uncomfortable topic. Yet if you reach the end of your life without getting your financial affairs in good order, you’ll risk leaving your heirs with problems that could’ve been avoided, causing them unnecessary stress and uncertainty during a time of grief.

You don’t have to be wealthy to leave behind assets worthy of careful estate planning. You may not be a multimillionaire yet, but your circumstances likely include some complexity that warrants putting a solid plan in place. If you’re someone who cares about your finances and loved ones now, you have reason enough to create and maintain an estate planning strategy for the future.

How to Get Started With Estate Planning

Whether you have amassed substantial wealth or you’ve simply acquired enough assets to live a relatively comfortable life, estate planning can be challenging if you don’t know what to do. The process can be emotional, confusing, and overwhelming. Knowing exactly what estate planning entails is the first step to getting started.

10 steps for smart estate planning

1 - Create a will if you do not have one.

We’ve all heard horror stories about people, including wealthy celebrities, who died without a will. This scenario is all-too-common as many people do not want to confront the inevitable. The truth is, there is no way of knowing when your time will come so you need to create a will as soon as possible. Simply put, a will is a legal document that allows you to communicate your wishes about the distribution of your assets after death and appoint guardians for your dependents. When there is no will in place, this is called dying intestate, and the state in which you reside gets to decide how to distribute your assets to beneficiaries based solely on state law. A will allows you to establish who gets what, and how the assets will be distributed. It will designate an executor to carry out the provisions within the will, name beneficiaries and guardians, and provide instructions for how your wishes are to be carried out.

2 - Complement your will with related documents.

If you already have a will, that’s a good start but it is not necessarily everything you need for comprehensive estate planning purposes. You might need to complement your will with additional important documents. Consider having a living trust. A living trust is a legal document that states who you wish to manage and distribute your property if you are unable to and who will receive it upon your death. When you sign a living trust, you maintain control of your assets but it transfers ownership to the trust. This way, a trustee will be in charge of your finances if you become incapacitated. Then when you die, property can be distributed without going through state probate courts and your financial matters remain private. A living will is another document you might want to consider having in place. A living will is a legal document that makes your wishes known and serves as a directive when it comes to medical treatments and life-prolonging measures. In other words, it speaks to whether or not you wish to be taken off of life support or other circumstances in which you are unable to express informed consent when terminally ill. You’ll also want to designate someone to make decisions about your health and finances if you are unable to do so. A durable medical power of attorney is a document that names a person who can make end-of-life decisions on your behalf. A healthcare power of attorney is a document in which you name the person who can make decisions about care if you are temporarily unconscious or incapacitated but not necessarily terminal. A financial power of attorney is a document in which you appoint someone to handle financial affairs, such as paying bills or handling insurance claims, if you are incapacitated. Think carefully about what your wishes are and who you trust to make the right decisions when you are not able to do so. Make sure each person knows what your wishes are and that your loved ones are aware of who you have selected. Then get the appropriate legal documents in place.

3 - Review your beneficiary designations.

Another critical step in estate planning is to ensure beneficiary designations on retirement accounts and insurance policies align with your wishes, as these designations often override the wishes specified in your will.

At least every two years, check your IRAs, 401(k) or other retirement plans, annuities, and life insurance policies. You may have filled out forms at your employer, bank, or insurance broker upon establishing the account, and now your relationship with the designated beneficiary could have changed or that person is no longer living. Upon your death, some assets can transfer to beneficiaries without passing through probate as long as you designate a beneficiary. For bank and financial accounts, you can designate a pay-on-death (POD) beneficiary. For brokerage accounts--and in certain states real estate, motor vehicles, and other assets with titles--you can designate a transfer-on-death (TOD) beneficiary.

4 - Create asset and debt lists.

Your heirs have no way of knowing what your financial assets and debts are without a list. In fact, it’s not unusual for a person to have forgotten an old investment account, an inherited valuable piece of jewelry, or something else that needs to be included in the estate planning process. Start by listing all of the property you own and its financial value, including both real property and personal property. Next, list your bank accounts, brokerage accounts, insurance policies, and investments, and their approximate value. Then, list debts, including your mortgage, lines of credit, personal loans, consumer debts, and business debts.

5 - Plan your asset ownership.

As part of your estate planning, you may want to put a specific plan in place for any asset you have with title documents. This would include real estate, motor vehicles, boats, recreational vehicles, etc. If you have a co-owner, such as a spouse or an adult child, the title will automatically pass to that person upon your death. However, before you add a joint owner prior to your death, it’s essential to consider the legal and financial consequences. That person may be subject to the federal gift tax, and you need their permission to sell the property or secure a loan against the property.

6 - Cover your debts and financial responsibilities with insurance.

The last thing you want is to burden your loved ones with unnecessary financial strain and debt if you become disabled or die. That’s why getting adequate insurance coverage is a crucial part of smart estate planning.

Work with a trusted financial professional to select and secure the right combination of disability insurance, homeowners insurance, and life insurance to ensure you’re properly covered and able to provide for your loved ones when the need arises in the event of your death or you’re unable to work.

7 - Let your heirs know about the causes and charities that mean the most to you.

Another aspect of the estate planning process you may not have considered is the legacy you leave behind. If you wish to support a particular cause or organization, make sure your heirs are aware of any charitable contributions that you’d like to make. If you are leaving behind no debt and your heirs are financially secure, this may be an opportunity to give a significant gift that you were unable to make during your lifetime. You can also set up a trust that pays out to your beneficiaries during your lifetime and the remaining amount is donated to charity upon your death. An additional benefit to including charitable donations in your estate planning is that in some specific cases, it may reduce the estate tax burden on your family. Finally, you’re familiar with the phrase, “in lieu of flowers, the family requests that donations be made to …” Well, this is a nice opportunity to raise awareness for a cause that you care about and remember your favorite charitable organizations in your final wishes.

8 - Select a reliable executor.

Selecting a reliable executor is an important part of the estate planning process. Your executor is the person you appoint to carry out the terms of your will and the instructions you’ve included.

This person is legally obligated to act in your interest and will be responsible for making sure all assets in your will are accounted for and transferred correctly to the appropriate parties. Plus, they are responsible for ensuring your debts are paid off, including taxes. If you do not designate an executor, the courts will appoint one for you. Think about who you can rely on to be your executor. Ideally, it should be someone who is familiar with financial matters and can understand the basic principles of estate law. An attorney, accountant, or responsible family member are the most popular choices, but the main requirements are that the person is above the age of 18 and holds no felony convictions. Your executor should have copies of your important legal documents prior to your death; so again, it needs to be someone you can trust.

9 - Appoint someone you trust to be the guardian or conservator of your minor or disabled children.

Estate planning is not just about financial matters, it’s also about ensuring your dependants are taken care of in the event of your death or disability. If you have minor children, adult children with disabilities, or an elderly parent to whom you are a guardian, you should appoint someone you trust to act as the guardian or conservator right away. A conservator is responsible for taking care of their needs and living arrangements and a guardian is legally responsible for the dependent. If you do not appoint one, the state will decide for you and the outcome may not be what you would’ve considered favorable. Discuss your decision with the person and make sure they are prepared to take on the responsibility. You’ll want to make sure the person is responsible, caring, up for the challenge, and that the living arrangements would be suitable. You do not want your dependents to become wards of the state if you can prevent it.

10 - Talk to the professionals.

Estate planning is a complex process and it’s not something you should do without professional help. Unless you have very little in accumulated assets and no direct heirs, do-it-yourself estate planning is often a big mistake. You don’t want to leave behind a mess of legal and financial issues that cause undue burdens and emotional stress among your heirs. An attorney and financial advisor can help you manage the estate planning process to make certain you have all the proper documentation in place to ensure your loved ones are taken care of and your last wishes are carried out properly when you die.

In conclusion

Estate planning is not something reserved for the ultra-wealthy. It is a process all responsible adults should be doing to make sure their affairs are in order and that their loved ones are taken care of in the event of their disability or death. All too often, someone passes away without even seeing to it that their burial expenses are covered, leaving a will behind, or appointing a guardian for their children. Don’t let this happen to you. If you follow this estate planning checklist, you can cover the essentials and put your mind at ease.

John J. Diak, CFP® is the Principal & Client Wealth Manager at Oatley & Diak, LLC in Parker, Colorado. He assists clients through many difficult lifestyle changes such as business downturns, retirement planning, divorce, the death of a spouse, and family estate issues among others. Oatley & Diak, LLC is a family-run registered investment advisory (RIA) firm that provides clients with investment management and financial planning services in a hands-on, intimate environment. Learn more about them at

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.


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