Estate Planning Checklist

Your Estate Planning Checklist guides through planning for what happens next.

You’ve given so much to care for your loved one with unique needs. Our easy-to-follow downloadable estate planning checklist helps you determine what happens next.

Follow this estate plan template and have peace of mind your loved one will continue to get the care and support they need after you’re gone. Yes, estate planning paperwork does go beyond what to put in a will when you have a complex family situation. 

Download our Estate Planning Checklist

So what goes into the estate planning process? Let’s get started.

Document Your Medical Wishes

What documents do I need for estate planning? Let’s start by ensuring you’re personally taken care of in the event that you can’t make your own medical decisions.

If you don’t have medical wishes documented, the court will decide on your behalf. This can lead to misunderstanding and emotional distress among other family members. 

The best thing you can do for your family is putting your medical wishes in writing. Then communicate your wishes with key individuals before you pass, so they have an idea of what to expect.

Your medical wishes portion of your estate planning document checklist may include:

Advance Health Care Directive (formerly called Durable Power of Attorney for Health Care)

This estate planning document identifies the person you want to carry out your health care decisions, and how you want those decisions to be made.

HIPAA Waiver

This document preemptively waives your privacy rights under the Health Insurance Portability and Accountability Act so a specified family member or members can access your medical records. Hospitals and other medical providers must follow strict rules or suffer severe penalties without this document in place. While these rules are in place to protect your privacy, they can become barriers to care and the emotional well-being of your family during a health event.

POLST Form (Physician Ordered Life-Sustaining Treatment)

This document addresses “Do Not Resuscitate” wishes on a bright pink one-pager, to be posted in an obvious location such as on refrigerator or hospital bed, so EMTs know not to revive you.  Note: You should only fill this out if you truly do not want to be revived.

Disposition of Remains

Many people have preferences related to their final resting. This isn’t a conversation many of us want to have. But communicating your wishes directly with loved ones and putting those wishes in writing can prevent challenges while your family is sad and mourning. For example,

  • If you wish a burial, buy a plot beforehand to eliminate this additional step after you’re gone. Tell others the location of the plot.
  • If you wish a cremation, you can buy a pre-paid cremation service.
  • Outline any instructions for memorial services, Funeral, and Celebration of Life. Pay for this in advance or set aside the necessary funds when possible. In the state of California, these costs come before other creditors. You can write up your wishes with as many or as few details in a separate document. Do you want certain music played? Who would you like invited? Will food be served? Many prefer a celebration to a sad occasion, so make it a party!

Make Sure Your Assets are Accessible Upon Incapacity

Set up a Durable Power of Attorney (POA)

This legal document outlines who will make financial decisions for you while you live but cannot make decisions. You may limit those decisions in specific areas as you wish before becoming incapacitated. This POA remains in effect when you become incapacitated, but it ends when you pass away. This is opposed to a Non-Durable Power of Attorney, which ends after meeting specified criteria.

Make sure banks where a significant portion of your assets are held will accept your Power of Attorney. Or you can execute POAs specifically at those banks. And don’t forget to double-check that you’ve included gifting provisions in the POA, so Medi-Cal planning is possible if you ever need skilled nursing care.

Set up a Revocable Living Trust

Setting up a revocable living trust allows you to avoid probate if your total assets (without beneficiary designations) exceed $166,250. Most of the California families I work with do exceed this amount. As a result, they would like to see that money put toward meeting the family member’s needs as they intend.

Read more: What to Expect in Probate.

It’s important to know you can change a revocable living trust as family circumstances or finances change, as long as you’re “living”. As the settlor (the person creating and funding the trust), once you pass on, management of the trust shifts to the successor trustee you appointed, i.e. the future manager of trust assets.

This document eases the transition of decision-making if you were incapacitated. It helps facilitate a successor trustee to take over automatically. This gives you peace of mind that if something were to impact your ability to care for someone else, the quality care of your loved one would continue uninterrupted.

In complex family situations, you’ll set up Specialized Trusts for Family Members that allow the successor to manage the assets in the best interest of your family member (the beneficiary).

Depending on your unique situation, this trust may be a special needs trust or a lifetime trust for another family member, so as we progress through this estate planning checklist, let’s outline what you’ll need to mark off your to-do list.

Set up Specialized Trusts for Family Members

Special Needs Trust (“SNT”) for disabled family members

One of the great things about the SNT is that assets in it don’t count towards eligibility for needs-based public benefits such as SSI or Medi-Cal. As a result, your disabled loved one can continue to receive public benefits while having a “safety net” of money to provide for anything they need

Anyone can act as trustee of SNT, except for the beneficiary. Based on my experience working with so many families who find themselves in these complex family situations, I often recommend professionals. That might be a private professional fiduciary or a bank.

A trusted family member can act as a “trust protector:” They can review yearly accountings and have the power to remove and replace the trustee.

Learn more: Setting up a Special Needs Trust

Dynasty Trust/Lifetime Trust for typical family members

For family members without special needs, it is often a good idea to provide a controlled transfer of assets through a trust, as opposed to an immediate outright inheritance. I might recommend a Dynasty Trust in these instances. This part of your downloadable estate planning checklist offers you several benefits.

Learn more: Setting Up a Dynasty Trust

First, the assets in this trust pass outside of the loved one’s estate. They are, therefore, free from estate tax when the trust assets pass to their descendants. Second, the trust segregates assets from a loved one’s property, so in case of divorce, the other spouse cannot claim this as community property under California law. And finally, this type of trust offers you a high level of asset protection if your loved one has legal issues or creditor’s claims.

As you can see, a trust doesn’t belong to the beneficiary in any way. It exists for them. It’s not their asset, so it can’t legally be taken from them any more than a creditor could sue you for your loved one’s debts in the United States.

Create an “Important Papers and Information” File Including Your Checklist for Estate Planning

Keep this file in a safe location like a safe, safety deposit box, or secure electronic location. Put this file in the name of the revocable trust. Or add another family member assignor so they can access contents upon your death without any unnecessary hoops for your grieving family member to jump through while they’re understandably mourning your loss.

Keep a spreadsheet listing all accounts: entity names, account numbers and representatives. This makes it easier for the successor trustee to find your assets. Like this downloadable estate planning checklist is the ultimate guide to planning complex family situations, this file will be the ultimate guidebook for your family member to locate your assets and take next steps according to your documented wishes.

Here, keep updated contact information for:

  • Your health care professionals
  • Attorney
  • Financial advisor
  • Accountant
  • Life insurance professional
  • And so on

Don’t forget to add a file that includes your updated list of user names, passwords and personal ID numbers for online accounts. And keep hard copies or electronic copies of all estate planning documents, preferably in multiple secure locations.

Make Sure Trust Is Fully “Funded”

Did you know you can start a special needs trust with as little as $10 in it? We call this a” seed” trust. It’s one crucial step you can take right now to secure your child’s future care with special needs. You can schedule a free initial call to discuss setting this up.  

Be sure to title all real property in the US in the name of the revocable trust.  Also, title for larger bank and brokerage accounts should be in the revocable trust.

Update beneficiary designations. Make sure you update retirement account beneficiaries and life insurance policy beneficiaries through beneficiary designation forms.

Did you know under the SECURE Act, there are income tax advantages for naming a spouse directly as beneficiary or naming a disabled child (or their SNT)? If you’ve created lifetime trusts for your children, consider naming those trusts as beneficiaries.

Total assets outside the trust, without a beneficiary designation, can only total $166,250 (as of 2021)

Look Over Trust Documents Every 3-5 Years Using this Estate Plan Checklist

Too many families trying to do what’s best set up an essential legal entity like a trust and then forget about it. But you should review these documents every 3-5 years to make sure they still meet the needs of each family member.

During this time, you should ask yourself some important questions:

  • Is your choice of successor trustee still appropriate?
  • Is the trustee too busy/going through their own challenges/no longer available?
  • Would the named trustee cause challenges with family dynamics?
  • If the successor trustee is a professional, whether individual or a bank/trust company, are they still available to act? If an individual, do they have a succession plan? Have they made any policy changes that impact the trust?
  • Are all of your beneficiaries still alive?
  • Any updates to charitable bequests?
  • Any births/deaths/divorces/other challenges?

Make Introductions

For a trust to serve its purpose, often several people need to work together. So it’s critical that these professionals, successor trustee, and other parties know each other, or at the very least that the others exist.

Make sure important professionals (typically your estate planning attorney, financial advisor, accountant) are aware of each other and coordinate efforts where appropriate.

Inform successor trustee where you keep important papers.

Introduce your estate planning attorney to your successor trustee, so the successor trustee knows whom to contact if something happens to you.

Keep information on your person regarding where to find copies of the estate plan (for example, wallet card with health care instructions in your wallet).

Frequently Asked Questions (FAQs)

What are the main steps in an estate plan for complex family situations?

There are eight basic steps to create an estate plan:

  1. Document Your Medical Wishes
  2. Make Sure Your Assets Are Accessible Upon Incapacity
  3. Set Up a Revocable Living Trust
  4. Set up Specialized Trusts for Family Members
  5. Create an “Important Papers and Information” File
  6. Make Sure Trust Is Fully “Funded”
  7. Look Over Trust Documents Every 3-5 Years
  8. Make Introductions

Can I do my own estate planning?

Technically, yes. If you have clear instructions, some estate planning forms and a fairly straight-forward family situation, you can do significant DIY. However, those looking to do low-cost estate planning will find they incur many expenses when setting up the plan. This is especially true in complex family situations, where the lifetime care of a loved one is at stake.

In addition, there are 5 different types of taxes involved in estate planning. Those are estate tax, gift tax, California property tax, capital gains tax, and generation-skipping transfer tax. So incomplete planning can lead to a huge tax penalty in the future.  You should always work with a professional who knows how to circumvent the challenges that can arise from DIY estate planning.

What should you include in an estate plan?

This varies based on your individual situation. But generally, it may include medical wishes, asset planning, trusts, important documents, important people, and a review process while you’re still able to do so.

What is special needs estate planning?

People who have a family member with special needs often worry about what will happen to their loved ones when they’re no longer able to care for them. Special needs estate planning ensures that clear instructions, people, and funding are in place to care for that individual.

What should I consider in a special needs trust?

Each situation is unique. Generally, you must ensure

  1. its validity within your state,
  2. it’s irrevocable when funded,
  3. that it doesn’t interfere with benefits like SSI or Medi-Cal, and
  4. it meets its intent.

Who controls a special needs trust?

A successor trustee you designate manages the trust once you’re no longer capable of doing so.

Can you self-fund a special needs trust?

Yes. You (the disabled individual), your parent, grandparent, legal guardian, or the court can create a trust to hold your own assets.  This is called a “first-person” special needs trust, a “self-settled” special needs trust, or a “d4A” special needs trust.

What is the difference between a trust and special needs trust?

You can create a trust for all kinds of reasons.  A special needs trust is set up specifically to care for a child or adult beneficiary with special needs.