The Simple Four Step Guide to Estate Planning

By Garrett C. Spangler, J.D., LL.M. | Published: January 2022

The Importance of Creating an Estate Plan
Putting together an estate plan to ensure your family is well cared for in the future is important for everyone. Regardless of your level of wealth, taking stock of what you have and creating a plan to provide guidance to family and friends about your choices is imperative. Without it, a court may need to step in to authorize certain decisions on your behalf and state law to determine who will inherit your assets.

Everyone should take these four steps to ensure they have a plan in place.

Take Inventory
Everything you own is considered part of your estate and decisions should be made about how the various items should be handled. If you own a home or other real estate, determine if it should be passed to beneficiaries or sold and the proceeds added to your other estate assets. For jewelry, antiques, collectables, artwork or other assets, determine how they should be passed along and note where they are located, such as in a safe or safety deposit box. Gather recent statements for bank, brokerage, retirement, and any other accounts that you may have so your heirs know where your money is held, as well as any insurance policies and outstanding liabilities like mortgages, loans, and lines of credit. This information will be invaluable while creating your estate plan and for your heirs who will need to collect your estate assets.

Draft Estate Planning Documents
Meet with an estate planning attorney to help put together a comprehensive estate plan including Wills, Powers of Attorney, a Living Will or Advanced Healthcare Directive, and possibly one or more trusts if you have minor beneficiaries or a situation that might warrant additional planning. Consider who you want to inherit your assets and in what proportions, who should care for your minor children, the people you want to handle your financial affairs and medical treatments should you become incapacitated, who should be responsible for distributing your assets, and any end-of-life care preferences that you may have.

The attorney can discuss the pros and cons of these and offer advice regarding options available to you. They can also answer questions about the estate planning and administration process, and make a recommendation for the most efficient way to meet your goals.

Put the Plan into Action
After developing your estate plan there are some additional steps to ensure the plan is carried out as desired, including funding any trusts that you create and, if necessary, retitling property or assets into the names of the trusts. Also review all your financial accounts to ensure the beneficiary designations are current and reflect your wishes, even removing beneficiaries that may have been designated on non-retirement accounts to allow the assets to pass by the terms of your Will. Typically, an estate plan will include a reference to a memorandum which can be used to list certain tangible property and the names of the people you would like to receive it. If you are a business owner, you should also ensure that your estate plan and any business succession plan coordinate with each other.

Review and Update Your Plan
While initially preparing an estate plan is important, don’t forget to review the plan periodically (annually is best) to ensure it still reflects your wishes and to ensure the people you have named to help you and those you have selected to receive any assets still make sense. Any significant life changes such as getting married or divorced, children or grandchildren being born, a significant increase or decrease to your level of assets, or health changes may require changes to your plan.

In addition to periodically self-assessing your estate plan, check with your estate planning attorney approximately every 5 years. They’ll know if any changes to federal or state law could impact your plan and if your plan needs any changes as a result. A little extra time spent on estate planning can save you and your family a lot in terms of legal and tax efficiency after you pass away.

Planning Made Simple
The concept of estate planning often evokes ideas of complexity, high cost and being applicable only to the very wealthy, however everyone can benefit from an estate plan that ensures their goals are met and people they trust are appointed to help them both during their lives and after their passing.

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About the Author – Garrett C. Spangler, J.D., LL.M.
Garrett Spangler is West Capital Management’s Director of Wealth Planning and leads West Capital Management’s Planning Committee. In his role, Garrett works with clients on a variety of planning areas such as trust and estate planning, wealth preservation, and income tax and liability exposure. Prior to joining West Capital Management, Garrett was an associate at The Erb Law Firm, PC practicing tax, estate, and business succession planning, with a focus on non-citizens and international planning for those with foreign assets. Garrett earned his law degree (J.D.) and Masters in Taxation (LL.M.) from Temple University’s Beasley School of Law and his bachelor’s degree from Penn State University’s Smeal College of Business.

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