5 homeowner estate planning tips to consider

Published on June 22, 2023 | LPL Financial

Estate planning helps disperse your assets according to your wishes. The effort may seem daunting at first, but estate planning does not have to be overly complicated. With the proper planning, you may find yourself resting a little easier knowing you have an estate plan in place. While an estate plan is personalized to the wants and needs of each person, here are a few tips to help anyone get started.

1. Create an Inventory of Physical Assets

One of the first steps in creating an estate plan is knowing what you have, so you may list the items to include in the estate. For many people, working from the inside of the home is easiest. Start by assessing the items in your home that are valuable. These valuable items may include collectibles, jewelry, artwork, antiques, electronics, and power tools. This list may take some time to build, so creating it at a comfortable pace over multiple sessions might be appropriate.¹

2. Take Stock of Your Non-Physical Assets

You may also need to inventory your non-physical assets. These non-physical assets might include life insurance, long-term care, and health insurance policies. They also may include money sources, such as 401(k)s, IRAs, investments, and bank accounts. You want to include in your inventory the account numbers and documentation for these accounts.¹

3. Document Your Obligations

Your debts, such as loans and credit cards, should be itemized with account numbers, contact information, and where you keep your documentation on these debts. This strategy helps ensure that the estate pays off any required debt obligations, which the estate must pay from estate funds.¹

4. Consider Transfer-on-Death Assignments

With some assets, it is possible to bypass probate for those items, even if you pass away intestate (without a will), by creating a transfer-on-death designation for those assets. When these transfer documents are on file with certain accounts, the beneficiary might be able to receive the funds without having to wait for the completion of probate. Some of these types of accounts, which may have the option of a transfer-on-death designation, include savings accounts, brokerage accounts, and certificates of deposit (CDs).²

5. Make a Will

Your will serves as the instructions about how you wish to distribute your assets. This document helps ensure that your heirs know what you wish to happen with your estate. Having a will may reduce infighting among heirs. Your will designates who your beneficiaries are and what they get. It may cover custody of minor children and any charitable contributions you wish to make. You need to sign your will in front of witnesses. Be certain that its location is known to the executor of your estate to prevent delays in the will’s execution.²

Estate planning does not have to be a headache. Following these simple tips and taking the time to document your assets properly may make estate planning more manageable.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by WriterAccess.

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Footnotes

¹ Estate Planning: 16 Things to Do Before You Die
² Estate Planning Basics