Every adult needs at minimum a will, durable power of attorney, and healthcare directive regardless of wealth A revocable living trust can avoid probate, maintain privacy, and provide for seamless asset management Review and update all estate documents and beneficiary designations after any major life change Powers of attorney are critical for protecting your family from costly court proceedings during incapacity Work with an estate planning attorney to create a coordinated plan that reflects your current wishes and circumstances

Estate Planning 101

Curated by: Rubric Advisors

Estate Planning 101

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Why Estate Planning Matters

Estate planning ensures your assets are distributed according to your wishes, not default state laws
Without a plan, your estate goes through probate, which is public, time-consuming, and often expensive
Estate planning is not just for the wealthy; anyone with dependents, assets, or specific wishes needs a plan
A proper plan also protects your family by naming guardians for minor children and providing for their care

Wills: The Foundation

A will is a legal document that specifies who receives your assets and who serves as executor of your estate
It is the only document where you can name a guardian for your minor children if both parents pass away
Assets passing through a will still go through probate, which varies in cost and complexity by state
A will should be reviewed and updated after major life events such as marriage, divorce, birth of a child, or a move
Dying intestate, meaning without a will, lets state law determine asset distribution which may not match your wishes

Revocable Living Trusts

A revocable living trust holds your assets during your lifetime and distributes them at death without probate
You maintain full control as the trustee and can modify or revoke the trust at any time while you are alive
Assets must be retitled into the trust, a process called funding, for the trust to function properly
Trusts provide privacy since they are not part of the public probate record, unlike a will
A successor trustee takes over management of trust assets if you become incapacitated or pass away

Powers of Attorney and Healthcare Directives

A durable financial power of attorney authorizes someone to manage your finances if you become incapacitated
A healthcare power of attorney designates someone to make medical decisions on your behalf if you cannot
A living will or advance directive documents your wishes regarding life-sustaining treatment
Without these documents, your family may need to petition a court for guardianship, which is costly and stressful
These documents should be executed while you are healthy and mentally competent, not during a crisis

Beneficiary Designations

Beneficiary designations on retirement accounts and life insurance override whatever your will says
Failing to update beneficiaries after divorce or remarriage is one of the most common and costly estate planning errors
Review all beneficiary designations on 401(k), IRA, life insurance, and transfer-on-death accounts annually
Consider naming contingent beneficiaries in case your primary beneficiary predeceases you
Coordinate beneficiary designations with your overall estate plan to ensure consistency and avoid conflicts

Key Takeaways

Every adult needs at minimum a will, durable power of attorney, and healthcare directive regardless of wealth
A revocable living trust can avoid probate, maintain privacy, and provide for seamless asset management
Review and update all estate documents and beneficiary designations after any major life change
Powers of attorney are critical for protecting your family from costly court proceedings during incapacity
Work with an estate planning attorney to create a coordinated plan that reflects your current wishes and circumstances

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Why Estate Planning Matters

Wills: The Foundation

Revocable Living Trusts

Powers of Attorney and Healthcare Directives

Beneficiary Designations

Key Takeaways

Related Topics

Estate Decisions

Estate Planning Deep Dive

The Probate Process

Why Estate Planning Matters

Wills: The Foundation

Revocable Living Trusts

Powers of Attorney and Healthcare Directives

Beneficiary Designations

Key Takeaways

Related Topics

Estate Decisions

Estate Planning Deep Dive

The Probate Process