Estate Planning Checklist for 2024

Estate planning is more than writing a will; it’s a plan to manage the legacy you want to pass to your loved ones.  It documents your healthcare preferences, prepares for aging and incapacity and conveys your assets to those you choose.   The National Council on Aging (NCOA) Adviser’s article, “Estate Planning Guide and Checklist for 2024,” offers an overview of what to consider when planning your estate.  There is no perfect checklist as all estate plans should be tailored to the individuals using them, and so what you may want or need could vary, but it’s certainly a good idea of what to consider.

So, this blog will cover an estate planning checklist for 2024.

Understanding Estate Planning

Estate planning organizes your affairs to fulfill your wishes after you pass away. It encompasses decisions about money, property, medical care and care for your beneficiaries. The process includes creating essential documents like wills, trusts, powers of attorney, medical documents and more.  Estate planning provides peace of mind that your wishes are known and respected, benefiting your loved ones, so it is important to consider all of the key documents in the estate planning checklist.

Key Documents in Estate Planning

  • Wills: A legal document that outlines how to distribute assets after your death.
  • Trusts: Contracts that allow a third party, or trustee, to hold property and other assets on behalf of a beneficiary.  These are used for many purposes depending on what kind of trust, such as tax planning or probate avoidance.
  • Powers of Attorney: Legal documents that grant someone else the authority to make decisions on your behalf, such as if you want to delegate to someone or because of your own incapacity.
  • Medical Documents: Documents that state your wishes regarding medical treatment when you cannot communicate your choices.  These, depending on your state, including documents like medical powers of attorney, directive to physicians (living will), HIPAA authorization or similar documents.
  • Disposition of Remains. Some states, such as Texas, have a standalone estate planning document that indicates what your final disposition wishes are, such as cremation or burial, and who is in charge of seeing that through. Other states work these concerns into existing documents.
  • Guardianship for Children.  This isn’t applicable to everyone, but if you have minor children you can name a guardian to care for them should you pass away.  This is often one of the main reasons why young couples even consider estate planning.

Key Takeaways

  • Common Estate Planning Documents: Wills, trusts, financial power of attorney and medical documents are fundamental to estate plans.
  • Everyone Needs a Will, but Consider a Trust: Regardless of the size of your estate, a will is crucial to fulfill your wishes.  What you do beyond that is dependent on your goals and situation, but always consider a trust.  People tend to assume a trust is only for the rich, but trusts are very versatile and help with many client concerns in a way that wills cannot.
  • Review Your Estate Plan Regularly: The original article says update your estate plan regularly, I say review it.  If you don’t review it regularly, it is easy to  forget the details, which makes the estate plan difficult to properly implement and even harder to update.  2024 is an excellent year to review because the estate tax thresholds are changing in 2026, exposing more clients to estate taxes than in the past.

Conclusion

Consider estate planning to be a critical process to protect your assets, provide for beneficiaries and have peace of mind for the future. Follow the estate planning checklist to create your personalized estate plan.

Reference: NCOA Adviser (Aug 21, 2023): Estate Planning Guide and Checklist for 2024.

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Planning for a Loved One with Dementia

Having the conversation about dementia with a loved one is never easy says The Tribune-Democrat’s recent article entitled, “Dealing with dementia | Planning ahead: ‘Have the conversation.’” But, it is important to discuss the future and ensure your loved one is well-cared for.

First, it is important not to wait too long to have this conversation.  Once there is a diagnosis or symptoms, it’s time to act.  Dementia and similar diseases are degenerative so they won’t get better on their own.  Delay in confronting this issue won’t make things better, and can limit your options on how to address it.

Plus, you want to get as much input from your loved one with dementia as you can.  As the disease progresses, they will have a harder time making their own choices, considering their situation and offering direction and preferences for their own welfare.  This could be everything from living arrangements, care plans, estate planning, to bucket list items.  Starting early includes your loved one as much as possible and preserves their own wishes and choice.

Next, address the legal documents and define the future care. Of course, you should have an estate plan in place long before this.  But, dementia will affect a person’s capacity which may make them unable to create a new plan.  So, this may be the last, best opportunity to review and update the estate plan.

You should especially review the incapacity planning documents such as powers of attorney or trusts.  These documents can help prevent the person from being placed in guardianship by the court, which is an expensive, difficult process for families. When granted, the court appoints a decision-maker, taking away the individual’s ability to make decisions – either in whole or in part. This court oversight continues throughout the individual’s life or until capacity returns.

You especially want to review who your fiduciaries are (such as your agent to make financial decisions for you) and the powers you’ve given them.  For example, if you want to use Medicaid to help pay for your long-term care, the power for your agent to make gifts may become important where it wasn’t 15 years ago when you first executed the power of attorney.

Similarly, it is important to update your medical powers of attorney and directive to physicians, as well as discussing your wishes and preferences with your agent.  These documents appoint a person to make medical decisions on your behalf if you can’t, including end-of-life care.  Having the conversation with your agent about your preferences will prepare your agents to make those decisions and relieve the burden of worrying they are making the wrong decisions.

As a final point here, you should discuss the future care plan with your loved one. Is the plan to live at home?  Will family assist with care?  Will in-home care workers be hired to assist, or is an assisted living or nursing home a better idea?   What’s more, how do you pay for it?  It is often important to discuss these question with your financial advisor and an elder law attorney so that you can make an informed choice.  You may also consider whether and how to use Medicaid or other long-term care programs to help pay for future care.  The answers to these questions also impact your estate planning.

Reference: The Tribune-Democrat (July 29, 2023) “Dealing with dementia | Planning ahead: ‘Have the conversation’”

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Estate Planning for Singles

Single clients often don’t think about estate planning as much as married clients, especially if they don’t have kids.  But, estate planning is even more critical for singles than married couples—and it has nothing to do with whom you’ll leave assets to when you die. A recent article from AARP, “6 Estate Planning Tips for Singles,” explains how estate planning addresses support during challenging life events.

To consider this, keep in mind that estate planning addresses medical and financial decisions for an incapacitated person, not just where you leave property when you die. For singles, these may be more complex questions to answer.

Whether someone has never married or is divorced or widowed, these are challenging questions to answer. However, they should be documented. In addition, singles with minor children need to nominate a trusted person who can care for their children if they cannot. Estate planning addresses all of these issues.

To be sure you complete this process, start with a conversation with an experienced estate planning attorney. This will help with accountability, ensuring that you start and finish the process.

See the original article for the fuller list, but here are some pointers for singles who keep putting this vital task off:

1.What would happen if you don’t leave clear instructions about who makes decisions for you during your incapacity? Some states have default decision makers for medical decisions, but not for financial ones.  Also, how will the person who acts (whether you chose them or not), know if you don’t want to be placed on a ventilator for artificial breathing or fed by a stomach tube while in a coma? Or how will they know what financial decisions you are ok with?

2. Dying without a will is known as dying “intestate.” All of your assets will be distributed according to the intestate succession laws in your state. That very often isn’t what clients wanted or are expecting, and typically is a far more expensive and time consuming process. Also, singles often want to leave assets to friends or non-family loved ones, and none of those individuals are beneficiaries in intestate laws.

3. Part of your estate plan includes naming a personal representative—an executor—who will oversee your affairs after your death. You’ll want to designate someone who is organized, has good judgment and can handle financial matters. You should also name a backup, so that if the first person cannot or does not wish to serve, there will be someone else to take control. This same issue applies to your financial and medical decision makers.

4. Your estate plan should include or at least consider the following:

Last will and testament. This is where you nominate your executor, heirs and how your assets will be distributed. Note that anyone named as a beneficiary on a retirement, insurance policy, or investment account supersedes any instructions in your will, so be sure to update those and check on them every few years to be sure they are still aligned with your wishes.

Living trust. This is a legal entity owning assets to be given to beneficiaries, managed by a trustee of your choosing, and avoids the delays and costs of probate. It also is helpful with managing assets during your incapacity

Financial Power of Attorney (POA). This document authorizes someone you name to act as your agent and make financial decisions if you cannot. A POA can prevent delays in accessing bank and investment accounts and paying your bills. The POA ends upon your death.

Living will, medical power of attorney, or advance health care directive. Different states use different documents here, but generally these documents allow you to designate someone to communicate your health care wishes when you cannot. For example, you can include instructions on pain management, organ donation and your wishes for life support measures.

Guardianship Nominations.  If you lack a fiduciary to control one of the issues described above during your lifetime, a court can appointment someone to do so.  That is far from ideal, but you can name who you want to be your guardian should it be necessary.  You can use similar documents to name guardians for your children.

Final Interment.  Estate plans, either through standalone documents or through the ones mentioned above, can indicate your final interment wishes (e.g. burial) and who you wish to be in charge of that process.

5. Be sure to communicate your wishes with family, friends and other advisors. Tell your fiduciaries where your documents may be found and provide them with the information they’ll need so they may act on your behalf.

Finally, we have a page on our website devoted to this topic, so see here for more ideas:  https://galligan-law.com/estate-planning-life-stages/planning-for-singles/

Reference: AARP (April 7, 2023) “6 Estate Planning Tips for Singles”

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