Post-COVID estate planning

When listeners come on my radio show or podcast to discuss their financial questions, they know that at some point in the conversation, I will ask about their estate documents. It does not matter whether it’s a young person, an older one, single or partnered, parent or childless.

As we approach National Estate Planning Awareness Week (Oct. 17-23), I thought now was a good time to nudge everyone about the importance of this topic.

A 2022 Caring.com survey found that just 33.1% of adults in the U.S. have a will.

Amazingly, after facing sickness and death amid the COVID-19 pandemic, a staggering 66% of Americans still do not have a will or any other estate planning documents in place. I know that it’s hard to contemplate illness, death and money — the trifecta of emotional issues. But if you can walk through the process methodically, you will be rewarded with peace of mind for you and your family.

Here are the most common estate documents to consider:

Will: A document that ensures that assets are passed to designated beneficiaries, in accordance with your wishes. In the drafting process, you name an executor, the person or institution that oversees the distribution of your assets. If you have minor children, you will name a guardian for them — a point that seems to be a big barrier for many families. My advice: Name someone you can both agree on now and revisit the issue in a couple of years.

Letter of Instruction: This may contain the appointment of someone who will ensure for the proper disposition of your remains. I know that this is sort of creepy, but it is important if you are choosing a method that is contrary to your family’s tradition.

Health Care Proxy: The appointment of someone to make health care decisions on your behalf if you lose the ability to do so. This is an invaluable document that will help guide your care, in a manner consistent with your wishes.

Even with a Health Care Proxy, you may need to complete a “Do Not Resuscitate” (DNR) order, which instructs health care providers not to perform CPR or other lifesaving emergency procedures if your heartbeat or breathing stops. A lot of people use a Living Will to communicate their end-of-life wishes, but in many states, you cannot use a Living Will to name a health care agent; you must complete a Health Care Proxy form.

Power of Attorney: The appointment of someone to act as your agent in a variety of circumstances, like withdrawing money from a bank, responding to a tax inquiry or making a trade.

Trusts: Revocable (changeable) or irrevocable (not-changeable) trusts may be useful, depending on family and tax situations.

The good news about estate planning is that it has gotten easier and less expensive over the past 10 years. If you have a straightforward situation, you can use an online service. However, if there are any complications, like a second marriage, family estrangement, a special needs family member or significant assets, I recommend using a qualified estate planning attorney in your state of residence.

As you prepare for the meeting (or the online session), remember that this process is a gift to your heirs — something that will help them manage the disposition of your estate without extra hassle. That said, you will have some homework, including gathering the following:

„ ■ Bank, brokerage and retirement accounts

„ ■ Pension/annuity documents/contracts „ List of savings bonds

„ ■ Life insurance policy details (private and through the employer)

„ ■ Housing, land and cemetery deeds „ Mortgage accounts

„ ■ Proof of loans made

„ ■ Location of safe deposit box(es) „ Accountant/CPA/investment/insurance advisor contact information