Estate Planning Checklist: All the Things You Need to Get Your Estate in Order

Estate planning allows you to decide who will receive your assets when you pass, who can make decisions on your behalf and who will care for your children if you cannot. A good plan protects your assets, minimizes taxes and ensures your loved ones are cared for. 

But planning for the future also comes with challenges, such as navigating legal compliance, financial protection and family dynamics. This may be especially true if your estate is complex or you have a blended family with numerous beneficiaries. Still, estate planning can be the best way to protect your loved ones and your legacy, and following a checklist can help you stay organized.  

Quick facts:  

• Estate planning can help minimize taxes, mitigate family arguments and avoid the potentially lengthy and costly probate process.  
• A comprehensive estate plan specifies your wishes regarding asset transfers, financial decisions, medical needs, funeral arrangements and the care of your minor children and pets.  
• Common estate planning documents include a last will and testament, trusts, beneficiary designations, healthcare directives, living wills and power of attorney designations.¹

Understanding estate planning

Estate planning is an important task that lets you designate someone to make financial and medical decisions on your behalf, take care of your children and pets, and administer your estate. It also outlines your preferences for charitable giving, business succession plans, end-of-life care and funeral arrangements.  

Estate planning can be an uncomfortable topic, especially when you're young and years away from retirement. Still, many financial advisors recommend starting an estate plan as soon as you become an adult since none can predict the future, and accidents and illnesses can happen at any age.  

When you die without a will or estate plan, your property is distributed according to state intestacy laws. Your estate, no matter how large or small, will go through probate, and the state will decide who inherits your assets, including your pet(s). If you have children and their other parent is no longer living, the court will appoint a guardian and a trustee to manage any inheritance.  

Key components of an effective estate plan

Estate planning is a collection of legal papers specifying your wishes. Here are some of the most common.  

Wills and testaments

A will (or "last will and testament") identifies the beneficiaries who will inherit your assets and names a representative (i.e., an executor) who will administer the estate and distribute assets to the beneficiaries. If you die without a will – a situation called "intestate" – your estate will be distributed according to state law.  

A will should generally include the following essential clauses to ensure it's valid and binding:

• Introductory clause: Identifies you as the testator and includes your full name, address and a statement indicating you're of sound mind  
• Declaration clause: Declares the document is your last will and testament and that you're signing it in the presence of two or more witnesses
• Bequest clause: Specifies who gets what after your death and can include general bequests (i.e., a percentage of your estate) and specific gifts, such as artwork or jewelry  
• Residuary clause: Covers assets or property you don't specifically include in the bequest clause  
• Guardianship clause: Appoints a guardian for your minor children or dependents²

Living wills/healthcare directives

A living will is a type of healthcare directive that specifies what medical care you want or don't want should you become incapacitated and can't make decisions for yourself.³ The document helps your family and healthcare providers follow your wishes regarding life-sustaining treatments, organ donation, pain management, religious preferences and other medical-related topics.   

Power of attorney

A power of attorney (POA) is a legal document that lets you name an attorney-in-fact (or "agent") to act on your behalf in financial transactions, healthcare decisions and other matters. By designating a POA, you ensure a trusted individual will handle your personal interests, even if you become incapacitated and can't make decisions for yourself.  

There are several types of POA, each serving a unique purpose:

• General POA: Grants broad authority over financial and legal decisions
• Durable POA: Remains in effect should you become incapacitated
• Medical POA: Grants authority to make healthcare decisions on your behalf
• Limited POA: Gives authority to act on your behalf for a limited period or specific task  

Trusts

A trust is a fiduciary agreement that allows a trustee to hold assets on behalf of your beneficiaries. Trusts usually avoid probate and can help lower estate taxes, depending on the type of trust you use. Trusts can be revocable or irrevocable:

Revocable trust: A revocable trust (aka living trust) can be amended or updated at any time as your circumstances or wishes change. This can be a good option if you want to retain control over your assets to accommodate changes in beneficiaries and assets. One drawback, however, is that the assets in a revocable trust remain yours (as grantor). For this reason, this type of trust offers less asset protection and tax reduction than irrevocable trusts.  

Irrevocable trust: An irrevocable trust generally can't be changed or revoked once established. As soon as you transfer assets into the trust, you relinquish control and ownership of them. An irrevocable trust can make sense if you're concerned about asset protection and tax liabilities because you and the trust are treated as separate entities – an arrangement that protects your assets from creditors. It also excludes the assets from your estate, which can significantly reduce estate taxes.⁴

Probate process

Probate is the formal legal process that validates a will, appoints an executor to administer the estate and ensures your assets are distributed to your intended beneficiaries. Probate also handles guardianship matters if you have minor children without a surviving parent.  

Not every estate needs to go through probate. Here are a few ways to avoid it.  

• Small estates: Most states permit small estates to go through a streamlined probate process or skip probate altogether.⁵  
• Trusts: When you set up a trust, you transfer your assets into the trust, and your trustee manages and distributes the assets according to your instructions, avoiding the probate process.  
• Jointly owned property: With jointly owned property, assets automatically transfer to the surviving joint owner without probate.  
• POD and TOD designations: Bank, credit union and retirement accounts can have payable-on-death (POD) beneficiaries. Investment accounts use a similar transfer-on-death (TOD) designation. POD and TOD accounts transfer directly to beneficiaries outside of probate.⁶  

Tax considerations

Estate and inheritance taxes apply to the transfer of property at death, but they have key differences. The estate pays the estate tax before assets are distributed, based on the estate's overall value. All estates are subject to the federal estate tax, though only 12 states and the District of Columbia levy the tax.⁷ Each beneficiary pays an inheritance tax based on what they receive. The tax is imposed in six states and does not apply at the federal level. Maryland is the only state that levies both an estate and inheritance tax.⁸

A good estate plan can help reduce taxes. For example, an irrevocable trust removes assets from your taxable estate, lowering the tax burden. You can also use charitable donations and gifts to lower your taxable estate.

Common challenges in estate planning

Legal barriers

Clear documentation and transparent communication can help you avoid common legal hurdles in estate planning, such as:  

• Contested wills: Someone with standing can contest a will if they believe the contents of the will are unfair, the will is not valid or the decedent lacked the mental capacity to create, change or sign the will.⁹  
• Estate fraud: Estate fraud is any illegal or deceptive action that manipulates an estate's assets, documents or administration. Examples include forgery, misrepresentation (influencing someone to change their will or trust under false pretenses), executor fraud (i.e., misusing funds or hiding assets) and identity theft.

Relationships

Sadly, it's very common for family members and other interested parties to fight over assets. Here are a few ways to limit conflicts:

• Create a clear and comprehensive estate plan.  
• Share your intentions with loved ones.
• Divide your assets evenly – or explain your reasoning if you don't.  
• Include a no-contest clause, which discourages legal challenges by disinheriting anyone who contests the will.
• Include a disinheritance clause if you wish to exclude someone from your will (so they can't claim you forgot to include them).  

Financial risks

Estates can encounter a range of financial risks like market fluctuations and legal battles that can drain estate assets. To minimize these risks:  

• Ensure your estate plan is comprehensive and clear.
• Review and update your estate plan regularly.
• Choose trusted and competent executors and trustees.
• Manage and rebalance your investments regularly.  
• Consider placing your assets in an irrevocable trust to protect against creditors and lawsuits.  

Strategies to optimize estate planning

Asset management

Even if you're a buy-and-hold investor, you should review and rebalance your investment portfolio regularly to ensure it stays aligned with your goals, risk tolerance and time horizon. Tools like personal finance apps, investment tracking platforms and brokerage account aggregators can make the process easier.  

Estate distribution

A good estate plan ensures your assets are distributed according to your wishes. The more specific you can be in your estate planning documents, the better. You'll use specific bequest clauses to pass individual gifts outlined in your will (e.g., your vintage Steinway piano, an artwork or a specific amount of money) to designated beneficiaries. After bequests, the remaining assets are distributed according to the will or trust instructions.  

Inheritance planning

There are numerous ways to pass down wealth, including naming beneficiaries on retirement accounts, designating transfer-on-death beneficiaries on bank and investment accounts and using joint ownership to transfer real estate. Be sure to consider not only who gets what, but when that happens. For example, gifting during your lifetime versus at death takes advantage of annual exemptions and helps lower estate taxes, avoids probate and lets you see the impact.  

Working with a financial planner

The benefits of estate planning can't be overstated. While DIY estate planning tools can be tempting, these options can backfire if you don't understand the legal intricacies of estate planning (most people don't), leaving you and your loved ones unprotected. A trusted financial planner can help you navigate the estate planning process to secure your legacy.  

Bottom line

Procrastination is a common estate planning mistake. It's easy to assume you'll have time to take care of estate planning later, but don’t always work out as expected. The best time to start estate planning is often when you become an adult with assets or a family. And because finances, relationships and life change constantly, it's important to revisit and update your plan regularly. Your future self (and beneficiaries) will thank you.  

Investment advisory and financial planning services offered through Summit Financial, LLC, an SEC Registered Investment Adviser, doing business as Conway Wealth Group (4 Campus Drive, Parsippany NJ 07054. Tel. 973-285-3600). Neither Summit Financial nor Conway Wealth Group provide tax or legal advice. 7730718.1

1. Consumer Financial Protection Bureau, “What is a power of attorney (POA)?” (January 2024)
2. Brown Law, “Last will & Testament: 2024 Guide on Writing Your Final Wishes.” (2024)
3. Mayo Clinic, “Living wills and advance directives for medical decisions.” (August 2022)
4. The Law Offices of Kristi Hancock, “Revocable Vs. Irrevocable Trusts Compared Side By Side.”  
5. Nolo, “How to Avoid Probate.” (January 2025)
6. Nolo, “How to Avoid Probate.” (January 2025)
7. Tax Foundation, “Estate and Inheritance Taxes by State, 2024.” (November 2024)
8. Tax Foundation, “Estate and Inheritance Taxes by State, 2024.” (November 2024)
9. MetLife, “What to Consider if You’re Thinking About Contesting a Will.” (January 2025)

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