Estate Planning

5 Estate Planning Documents That Everyone Needs

By Chris Duderstadt

October 18, 2023

5 Estate Planning Documents That Everyone Needs

Key Points – 5 Estate Planning Documents That Everyone Needs

  • Help Us Celebrate National Estate Planning Awareness Week
  • Key Differences Between a Will and a Trust
  • Make Sure Your Beneficiaries Are Current
  • Who Is Going to Make Your Medical and Financial Decisions If You’re Unable to?
  • 5 Minutes to Read | 24 Minutes to Watch

It’s National Estate Planning Awareness Week

In 2008, the National Association of Estate Planners & Councils created National Estate Planning Awareness Week. It takes place the third week of October and its purpose is to educate Americans about the importance of estate planning. It’s our goal at Modern Wealth Management to help people keep estate planning top of mind year-round. Please take a moment to review these five estate planning documents that everyone needs to have.

  1. Last Will and Testament
  2. Revocable Living Trust
  3. Beneficiary Designations
  4. Advance Healthcare Directive: Living Will and Medical Power of Attorney
  5. Financial Power of Attorney

5 Estate Planning Documents That Everyone Needs

One of the most frequently asked questions that our advisors receive is, “Do I need a will, a trust, or both?” Well, look at our list of estate planning documents. They’re No. 1 and 2, respectively! While a will is at the top of our list of estate planning documents, it might not be enough for your personal situation. Dean Barber and Bud Kasper, CFP®, AIF® are going to help explain the differences between a will and a trust and give an overview of the five estate planning documents that everyone needs.

“The last thing you want to do is have knee jerk reactions or have family fighting with each other. All that can be avoided, and you can have a smooth transition from one to from one individual to another if you get your estate plan done.” – Dean Barber

Schedule a Meeting Get the Retirement Plan Checklist

1. Last Will and Testament

The first estate planning document that you need to have is a will. With a will, you decide who you want to distribute your tangible and intangible assets to after you die. Examples of your tangible assets can include your house, land, and personal items. Intangible assets don’t have psychical form, so those can include intellectual property, brand recognition, and goodwill.

The people or organizations that you name in your will to receive your assets are your beneficiaries. Your beneficiaries can include family members, best friends, or charities that you’re passionate about. A will also gives you the ability to select an executor to manage your estate and serve as guardians to your minor children and/or pets.

Avoiding Probate

One of the biggest issues with only having a will is that you won’t give you the ability to avoid probate. The process of your assets going through probate court can be very expensive and time consuming.

“Every will has to be probated. In other words, you need to pay an attorney and a judge in the state that you live in a fee for somebody to read your will and say, ‘Yep, that’s what you wanted.'” – Dean Barber

That being said, it can be even more costly and time consuming if you don’t have a will. The bottom line with probate, though, is that it can be avoided if your assets are placed in a revocable living trust. They’ll go directly to your beneficiaries as long as you transfer the asset’s title to the trust.

“It’s not proactive; it’s reactive. Going through probate is something that you don’t want to have happen. You should still have a will, but it’s supposed to be there as a backstop if something wasn’t in the estate or if accounts weren’t titled properly.” – Bud Kasper, CFP®, AIF®

Speaking of revocable living trusts, look what’s next up on our list of estate planning documents that everyone should have.

2. Revocable Living Trust

A revocable living trust functions similar to a will in many aspects, as it distributes your assets to your beneficiaries following your death. However, there are some very distinct differences between a revocable living trust and a will.

A revocable living trust serves as an estate planning document that gives you much more control compared to a will. If you’re concerned about how your beneficiaries will handle your assets, a revocable living trust can even allow you to have control over your assets even after you pass away.

“A will is part of a trust. But what separates a trust from a will is that you can have ultimate control from the grave, if you wish.” – Dean Barber

Once you put your assets in the trust, the trust owns the assets. Meanwhile, you still have access to those assets while you’re still living. As long as you’re mentally competent, you can make changes to your trust or revoke the trust from your beneficiaries and trustees at any time and for any reason. Here are the steps to establishing a revocable living trust.

Steps to Establishing a Revocable Living Trust

  1. The grantor creates a written agreement (trust document) that declares a trustee to oversee their assets.
  2. The grantor names a competent adult, bank, or trust company as their trustee. Again, the grantor can also serve as a trustee while they’re living.
  3. Once the trust is written, it needs to be signed by the grantor and a notary.
  4. Put the assets into the trust.

With revocable living trusts, you get a much deeper sense of privacy and protection than you do with a will. However, revocable living trusts do tend to be much more expensive. Like our Director of Tax Corey Hulstein, CPA likes to say, financial planning is full of tradeoffs. The decision with having a just a will or trust is full of them.

3. Beneficiary Designations

Next up on our list of estate planning documents that everyone needs is a list of your beneficiary designations. While the privacy and protection of a revocable living trust can be very reassuring, there are still some assets that can transfer directly to a beneficiary without going through probate. Those assets include retirement accounts and life insurance plans. Your trust may say one thing, but your IRA beneficiary designation form will trump what the trust says.

“This is where more people make mistakes in estate planning than any other area. They think because they’ve completed their trust document that they don’t have to worry about that beneficiary form on their retirement accounts, whether it’s a traditional IRA, Roth IRA, 401(k), 403(b)—any of those qualified retirement plans. The beneficiary form trumps the trust 100% of the time.” – Dean Barber

To ensure that those assets don’t go through probate, designate a beneficiary at the places in which your non-probate assets are held. Also, there’s no need to keep your non-probate assets in a will since they won’t be going through probate.We can’t stress enough how important it is to make sure that your beneficiary designations are up to date. You should review your beneficiaries and update them as necessary following any major life event.

We highly recommend having annual family meetings to review all your estate planning documents with your loved ones. That way everyone knows who is getting what when you or someone else in the family dies. Those family meetings are a great opportunity to review your beneficiary designations.

4. Advance Healthcare Directive: Living Will and Medical Power of Attorney

An advanced healthcare directive comes in at No. 4 on our list, and it usually consists of two estate planning documents in one. Your advanced healthcare directive typically includes a living will and medical power of attorney.

If you’re incapacitated and can’t make decisions related to your health, having a medical power of attorney lets you dictate who makes those decisions for you. The person who you select is known as your healthcare agent. With a living will, you can detail various healthcare preferences regarding end-of-life situations and other medical treatments.

“If you’re on life support or in a position where it doesn’t look like you can be saved, your health care directive says, do I resuscitate or do I not resuscitate? That is part of the trust.” – Dean Barber

5. Durable Financial Power of Attorney

Rounding out our list of estate planning documents that everyone needs is a durable financial power of attorney. It allows you to appoint someone to make your financial decisions in the event that you’re unable to do so. The person who you select in your financial power of attorney is generally referred to as a financial agent. The tasks that your agent performs can range from paying your bills and making deposits to making payments to charities and collecting insurance benefits.

“The financial power of attorney and health care power of attorney are separate documents. We got them for my mother. She doesn’t have money, so there doesn’t need to be a trust. But she needed the health care directive, the health care power of attorney, and financial power of attorney. Somebody needs to pay her bills at some point if she’s incapable.” – Dean Barber

There Are Two More Documents You Need to Have: Our Estate Planning Guide and Retirement Plan Checklist

The estate planning documents that we’ve discussed can bring a peace of mind that is critical for you and your loved ones to have. Having a current estate plan is an essential component to your overall financial plan.

“Death is not something we necessarily think about a lot or want to necessarily engage in. But if you’re going to give your family a blessing, put it in writing so that there’s no arguments, no issues. If somebody wants to alter their gift, so be it. But it should be clear from the beginning.” –  Bud Kasper, CFP®, AIF®

There are actually two more documents that we want to make sure you’re reviewing with your spouse as you’re approaching and going through retirement. The first one is our Estate Planning Guide.

Our Estate Planning Guide goes in depth on the estate planning documents that we’ve covered and includes a 36-question checklist of estate planning considerations. Whether you want to leave a legacy or are expecting an inheritance, go through this guide to get a better grasp of how to build generational wealth.

Estate Planning Guide

The second one is our Retirement Plan Checklist. It consists of 30 yes-or-no questions that gauge your ability to successfully get to and through retirement. Several of them pertain to estate planning. Our Retirement Plan Checklist also has age-based timelines of key considerations throughout the retirement planning process. You can download your copy below.

Estate Planning Documents

Retirement Plan Checklist

Have Any Questions About These Estate Planning Documents?

A big part of estate planning is simply getting all your estate planning documents organized. If you have questions about what estate planning documents you need to have or specifics about certain documents, schedule a conversation with us. We look forward to discussing your estate planning and comprehensive financial planning needs.

See Our Schedule

Help us celebrate National Estate Planning Awareness Week by making sure your estate plan is current. We hope that you and your loved ones are all doing well as the holiday season draws near.

Watch Guide | 5 Estate Planning Documents That You Need to Have

00:00 – Introduction
01:17 – What Is Estate Planning?
04:10 – 1) Last Will & Testament
05:24 – TRIVIA: How Many Americans have a will?
08:39 – 2) Revocable Living Trust
– 3) Advanced Healthcare Directive: Living Will
– 4) Medical & Financial Power of Attorney
16:57 – 5) Beneficiary Designations
20:35 – What We Learned Today


Past Shows


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The views expressed represent the opinion of Modern Wealth Management an SEC Registered Investment Adviser. Information provided is for illustrative purposes only and does not constitute investment, tax, or legal advice. Modern Wealth Management does not accept any liability for the use of the information discussed. Consult with a qualified financial, legal, or tax professional prior to taking any action.