Estate Planning Checklist: Essentials Everyone Should Have

The following is a guest article by Steven Bowles, CLU®, founder of Catalyst Advisory.

Many people assume estate planning is something only the wealthy need to worry about. But in reality, it’s relevant to almost every adult. If you have a family, a home, savings, or retirement accounts, you should have an estate plan.  

Even those who know they need an estate plan often put it off because the topic is uncomfortable. A few months ago, at Catalyst Advisory, we surveyed 1,000 American adults and found that only 14% have had detailed inheritance discussions with family members.

When the estate planning basics aren’t in place or are not done correctly, it leads to higher stress and confusion for families.

It also increases the chances of assets being held up by a lengthy probate process or avoidable taxes taking a chunk out of the assets. On the other hand, simple and proactive planning can make the process smoother and more efficient for families and loved ones.

Unfortunately, unexpected events are inevitable, and it’s important to be prepared. In this article, we’ll examine the basics that everyone should have in place. You’ll come away with a DIY-friendly checklist to guide you.

What Estate Planning Is Really About

At its core, estate planning has a few simple goals.

1. Protects your family from unnecessary delays, legal expenses, and confusion. Without clear instructions, estates can get tied up in probate rather than being smoothly passed on.
2. Allows you to decide who inherits what, rather than letting the court make those decisions for you. Without a plan, you’re leaving the details in the court’s hands and allowing people outside of your family to make important decisions.
3. Ensure a trusted person is designated to make medical and financial decisions for you if you are incapacitated or unable to do so yourself. Estate planning also allows you to state your preferences for medical care and specify who should have what authority if you’re incapacitated.
4. Reduces stress later in life. Planning often brings peace of mind that people don’t expect when they begin the process, making retirement more enjoyable.

The Core Estate Planning Essentials

Here are the details almost everyone should address, regardless of the estate’s size or complexity.

1. Asset Inventory

An asset inventory is simply a list of what you own and where it’s held. This includes bank accounts, investment accounts, retirement plans, real estate, insurance policies, and digital assets.

The asset inventory makes it easy for family members to find all of your assets. Of course, it’s also important for your loved ones to know that your asset inventory exists and where they can find it. A simple spreadsheet or written list works as long as it’s accurate and accessible.

2. Will

A last will and testament, or will for short, outlines how your assets should be distributed after your death, and you can name an executor to carry out your wishes. If you have children, it should also state who will care for them in case of your death. 

For many families, a simple will created through a reputable online service or a state-approved form is sufficient. The important thing is that it exists and reflects your current situation.

3. Financial Power of Attorney

A power of attorney for finances authorizes someone to manage your finances if you become incapacitated. This includes paying bills, managing accounts, and real estate transactions, etc.

Without this document, your family may need court approval to make financial decisions on your behalf. It’s a relatively simple document that’s easy to set up before it’s needed, and it will avoid a lot of stress and delays if the time comes when it’s needed.

4. Healthcare Directive and Medical Power of Attorney

These documents allow you to spell out your medical wishes and name someone to make healthcare decisions if you become incapacitated.

This impacts more than just end-of-life scenarios. It also applies to temporary situations where you may be unconscious or unable to communicate, so it’s relevant for adults in all stages of life.

5. Beneficiary Designations

Many assets, like retirement accounts and life insurance policies, pass directly to beneficiaries rather than being subject to your will. That makes beneficiary designations one of the most critical parts of estate planning. Review them regularly to make sure they align with your current intentions and preferences.

6. Letter of Instruction

A letter of instruction is an informal document that provides practical guidance. It can include information about account logins, funeral preferences, and personal messages to loved ones. While it’s not legally binding, it’s often one of the most helpful documents for families.

7. Life Insurance

Life insurance can play a key role in replacing income, paying off debts, or covering final expenses. For many families, it serves as a financial safety net during years when others depend on their income.

Additional Options for Certain Situations

Some families may benefit from additional planning tools, depending on their goals and circumstances.

A revocable living trust helps keep matters private and provides more control over how and when assets are distributed, which also reduces the court’s involvement. It’s not necessary for everyone, but it can be useful in situations involving multiple properties, blended families, or a desire for added control.

A family constitution or written set of shared values can guide future generations. While it’s not a legal document, the family constitution is useful for establishing values and guiding principles. Family constitutions are often associated with wealthier families, but the concept can be valuable for any family that wants to be intentional about communication and expectations.

What You Can Do Yourself and When to Get Help

A DIY approach is sufficient for many of the estate planning needs of the average family. Creating an asset inventory, reviewing and updating beneficiary designations, drafting a letter of instruction, and even outlining family values are all tasks you can handle on your own.

Some documents benefit from professional review, even if you start with a template. Healthcare directives, powers of attorney, and simple wills often fall into this category. You could complete them on your own and hire a local attorney to review them, or use online tools like LegalZoom, Quicken, or Trust & Will.

Professional guidance is recommended for larger estates, blended families, business ownership, complex family dynamics, property in multiple states, or if you have dependents with special needs.

Keeping Your Plan Up to Date

Life changes, and your estate plan should change with it—yours and your spouse’s. Revisit your documents after major events like marriage, divorce, a new child, a death, a move, or meaningful financial shifts. Tax law changes can also trigger a review.

Even without big changes, checking in every three to five years helps ensure everything still reflects your wishes.

Overcoming the Biggest Obstacle

Estate planning doesn’t need to be complex or costly. For most families, the hardest part is starting. Simply organizing key information, writing down your wishes, and talking with your family can make all the difference when it matters most.

About the Author: Steven Bowles, CLU®, is the founder of Catalyst Advisory, an independent wealth transfer advisory firm. He specializes in helping entrepreneurs, business owners, and investors navigate the complexities of legacy planning, but believes the fundamentals of good estate planning apply to every family, regardless of net worth. Steven lives outside Philadelphia with his wife and three sons.

Craig Stephens

Craig is a former IT professional who left his 19-year career to be a full-time finance writer. A DIY investor since 1995, he started Retire Before Dad in 2013 as a creative outlet to share his investment portfolios. Craig studied Finance at Michigan State University and lives in Northern Virginia with his wife and three children. Read more.