Estate Planning Basics: What Every Family Needs in Place

Estate planning is not just for the wealthy, and it is not just about death — it's about ensuring that your wishes are followed during incapacity as well as after death, and that your family is spared difficult decisions and potential conflict during already-hard circumstances. Every adult needs these documents in place; the urgency only increases as parents age.

The foundational estate planning documents are a last will and testament, a durable power of attorney for finances, a healthcare power of attorney (or healthcare proxy), and an advance healthcare directive (commonly called a living will). Together these documents ensure that someone trusted can manage financial affairs if your parent becomes incapacitated, and that healthcare decisions align with their stated wishes.

A living trust, in addition to or instead of a will, can help estates avoid the probate process, which can be lengthy and costly depending on your state. Trusts are particularly valuable for families with real estate holdings in multiple states, blended family situations, or estates above certain value thresholds. An estate planning attorney can advise on whether a trust makes sense for your parent's specific situation.

Beneficiary designations on retirement accounts, life insurance policies, and bank accounts override whatever the will says — which surprises many families. Review and update beneficiary designations carefully. An account that names a deceased spouse or an estranged family member as beneficiary will pass to that person regardless of what the will instructs. These designations require regular review, especially after major life changes.