When we talk about estate planning, most people think of signing a will (some may even mention a revocable trust as well). But having signed documents is only the beginning; not following through can still leave a mess for your heirs. You need to go beyond the basic plan.
The Basic Plan – means you executed a will and probably a revocable trust, updated beneficiary designations and changed ownership to match your documents to minimize estate taxes and control flow of your inheritance. For this post, we assume you have a good plan (check out the post to be sure) and if you have not acted, please see estate planning checkup: why you don’t, why you should.
Beyond Basic – is the focus of this post so you prepare the people who survive you so they can assemble the pieces you leave behind and make decisions. We review this roughly in the order in which they will have to address everything and respond so nothing is left unresolved.
Write notes or better provide a memorandum now
How do you address “beyond basic estate planning”? One way is to have a detailed conversation or better yet to provide a memorandum for your personal representative, trustee, children or close friend that can help them navigate all the steps required after your death. Start by with telling them where to look for everything. But a good “beyond basic estate planning” plan encompasses more than listing where to locate the documents you signed, it tells survivors who to notify (attorney, tax preparer, insurance agent), how to access your accounts on line or in person, and who gets what and when.
Note: make sure they know where your original will is located, as well as whom to contact. Not having the original can cause problems. Same for other originals like stock certificates and car titles.
Notifications
When you die, the first step for your survivors will be to notify family and friends and to arrange for services. Make sure your survivors know everyone you want them to contact or even who you don’t want attending your services. Also, make sure they know if you want to be buried or cremated. If you have a plot, let them know where. If you envision a particular service, tell them.
Beyond telling friends and family of your services, there will be more notifications:
Professionals – make sure they know your attorney and tax prep person so they can notify and they can be ready for their roles – more on this below.
Medical professionals – depending on your death, your family will want to make sure your family doctor and others are notified.
Social Media – do you want them to post about your demise on social media? – more on this below.
Social Security – your heirs will need to inform the administration so that they stop your benefit. Your spouse will need to sign up for the spousal benefit.
Banks and investments – your heirs will need to let banks and brokers know so no one other than your personal representative tries to gain access.
Board of directors or other office positions – if you are on a board or hold office, be sure survivors know whom to contact.
Death certificate
Soon after your death, a medical examiner will produce a death certificate. That will be required for filing in probate, if necessary, and for access to benefits and accounts or making certain transfers. Your personal representative will want to provide copies to your attorney but hold some copies for transferring accounts and titles.
Internet age – social media and online accounts
What do you want your heirs to do with your social media? You want to avoid anyone gaining access and attempting identity theft. Do you want them to leave your profile active for a period?
Do you have shared accounts where you are the manager, such as a photo stream on your smartphone? Be sure survivors know how to access and copy. For instance, anything in an Apple photo stream disappears once the source photo is deleted so deleting your iPhone account could cause all photos taken by you to be lost and pictures you contributed to various photostreams will disappear. Check with your provider to be sure how to archive what you want archived.
The same may apply to other items stored on your smartphone. You may need to maintain your account until others access and save everything. You can also setup cloud storage and make sure they know how to access.
How do they access your online accounts? How do they terminate all those subscriptions you never canceled? Your memorandum should include information for key people that are likely to survive you. They will need IDs and passwords for all your online accounts. You may also want to provide access to your smartphone so they can use the apps that may have reward balances.
With access to your online accounts, they can stop recurring payments, end subscriptions, and pay bills until they have access to your assets. If your assets are already in trust, the trustee may be able to pay bills as required. If your assets are not in trust, the personal representative will need to transfer them to estate accounts after being appointed.
Make sure your list of all IDs and passwords identifies key accounts and is provided to somebody you trust so they can manage access until accounts are transferred.
Assets and accounts
When listing your online accounts, provide a detailed list of all your assets so nothing is overlooked and ends up unclaimed. Your survivors may be able to see the accounts on line and provide statements to your attorney.
If you are holding assets for others or promised to make a gift (see below), be sure to state this in your memorandum.
As noted above, they will need certain originals, like your will and titles to cars. If you hold certificates for stocks or bonds, they will need to know where to look – a safe deposit box? If you have cryptocurrency or other digital assets, they will need to know where your wallet is and how to access your accounts.
Specific gifts of personal items
If you have items for which you have certain people in mind, make sure your personal representative knows. As noted above, if you are holding items for others or have promised to make gifts, be sure your personal representative knows your intent. You may also want certain personal items to go to specific people, such as heirlooms, jewelry, memorabilia, etc. You may have signed a tangibles memorandum with your will; if not, be sure to list items and recipients.
Life insurance and benefits
If you have life insurance, make sure they know where the policy is and who handles it. The personal representative will need to contact them to arrange payment to the policy beneficiaries.
The same for any pension for survivors and other benefits.
Retirement plans
If you have qualified plans, make sure beneficiaries know they will be receiving your account. They may need a death certificate and have forms completed by the personal representative to have the account transferred to them as an inherited IRA.
Tax returns
Notify your tax preparer so they know to advise on what needs to be filed. They will file a tax return for the part of the year when you were living and then an estate return for the remainder.
Conclusion
Think through all you do now and imagine what others would require in order to be able to do those things then write it down! Save your survivors from having to be detectives.
In the end, your memory will survive and you will be known for your deeds and how you treated others.
Steven
