Anyone who owns property or assets of any kind has an estate. Estate planning is the process of preparing for what will happen to your assets when you die or become incapacitated.  

An estate plan answers the questions: 

• What are my assets? 
• How will my assets be distributed? 
• Who do I want to leave my property to? 

In addition to asset distribution, estate plans also prepare for: 

• Who will care for or raise your dependents if you die 
• What kind of medical care you will receive 
• Who will make decisions regarding your health care if you’re unable to 

The biggest benefit of having an estate plan is peace of mind. With an estate plan, you control who gets your property and can ensure your loved ones are provided for when you pass away. 

When considering what assets to include in your estate plan, “you want to consider all of your assets,” says Ohio estate planning and probate attorney Jay E. Michael. 

“Whether the assets are digital, whether they’re held in paper form, whether they’re stocks and bonds in a drawer—they could even be something as crazy as gold or silver bars. There could be all different types of assets. But any asset needs to be addressed,” says Michael. 

This article will cover the basic steps to creating an estate plan and the assets you want to consider. 

Assets to Consider in Your Estate 

“Any and all” assets should be considered when making an estate plan, says Michael.  

Of course, everyone’s estate will consist of different things. In general, however, you want to make sure the following types of assets are accounted for: 

• Real estate, including your house or land 
• Cash, bank accounts (savings accounts, checking accounts), safe deposit boxes 
• Stocks and bonds, mutual funds 
• Investment accounts or brokerage accounts 
• Retirement accounts, including IRAs and 401(k)s 
• Life insurance policies 
• Digital assets  
• Collectibles (art, antiques, etc.) 
• Other personal property such as cars, furniture, etc. 

Basic Steps to Estate Planning  

It’s important to consider several key things when creating the best plan for your situation. 

• Last will and testament. A will is a legal document that details your final wishes. It can touch on many different issues, including:  
  • How your property should be distributed when you die 
  • Appointing an executor (more on that below) 
  • Naming a guardian for your children, if applicable 
  • Making sure your pets are taken care of 
  • Settling remaining debts, bills, and taxes (including estate taxes if your estate is large enough) 
  • Funeral arrangements 
• Name an executor. An executor is an individual responsible for collecting and distributing a deceased person’s assets according to the deceased’s will. The executor is named in the will. The probate court will appoint an executor if the deceased did not. The executor initiates the probate process and represents the estate in probate court. When creating a will, it’s a good idea to name an alternate executor as well, someone who will take over the executor role if your first pick cannot or refuses the role. 
• Living trust. The benefit of a living trust is that assets in the trust avoid probate. The person who creates the trust (called the grantor) can put whatever assets into the trust they want to be distributed to their beneficiaries when they die. In a revocable living trust, the grantor can change the trust as they see fit. In an irrevocable trust, once the trust is created, it can’t be changed. There are different types of trusts, including martial, life insurance, and real estate trusts. An estate planning lawyer can walk you through the best options for your estate. 
• Living will. Also known as a health care directive, a living will specifies the kind of medical care you will receive and how end-of-life situations should be handled if you become incapable of making medical decisions. A related concept is the health care power of attorney or health care proxy. This is an individual you appoint to make healthcare-related decisions on your behalf. 
• Name a guardian for minor children. If you have a child under 18, you can name a guardian who will raise them and look out for their interests in the event you pass away before the child becomes an adult. 
• Beneficiary designations on accounts. Many types of accounts (including bank accounts and retirement plans) allow you to name beneficiaries. These are known as “payable on death” (POD) or “transferable on death” (TOD) accounts. Naming beneficiaries on an account allows you to pay out or transfer the account to the beneficiary when you die, avoiding the probate process. Designated beneficiaries could include:  
  • Surviving spouse 
  • Children 
  • Siblings 
• Durable power of attorney. In addition to having a medical power of attorney (discussed above), consider having a power of attorney for your finances. This person will be authorized to make financial decisions on your behalf if you become incapacitated. 
• Life insurance and long-term care. You may want to consider getting a life insurance policy to help pay debts or leave something to beneficiaries when you die. 

What Happens if I Die Without a Will? 

If you die without a will, your estate will be distributed according to your state’s intestate laws.  

Also known as statutes of descent distribution, intestate laws specify the order of succession. State laws differ, but intestate succession generally works out from the closest to more remote relatives.  

For example, starting with a person’s surviving spouse if there is one, the succession would go to biological and adopted children, grandchildren, surviving parents, siblings, nieces and nephews, and aunts and uncles. 

The order of succession in your state may be different. It will depend on the law and the family members who survive you. 

Do I Need an Estate Plan?  

While having an estate plan is optional, having one is very wise.  

As discussed above, if you don’t have an estate plan of any kind, your assets will be distributed by your state’s intestate laws. This could very well result in your assets getting distributed in ways you would prefer not to happen. 

Lacking an estate plan means you have no say in how your assets are distributed or how your surviving loved ones will be provided for. 

In addition to giving you control over your estate, an estate plan also makes the process of distributing your estate much less stressful for your surviving family members.  

An estate plan tells your loved ones exactly how you wanted things to go and gives them peace of mind that your wishes are being followed. It also provides clear directions that can avoid probate litigation and infighting among the family. 

Questions for an Estate Planning Attorney 

If you are trying to figure out which assets to include in your estate plan, consider speaking with an estate planning attorney. 

An attorney can assist you through the entire estate planning process, from making an inventory of assets to drafting legal documents.  

Fortunately, many lawyers provide free consultations for potential clients. These meetings let you get legal advice and decide if the attorney meets your needs. 

To get the most out of a consultation, ask informed questions such as: 

• What are your attorney’s fees and billing options? 
• What estate planning documents do I need? 
• Should I set up a trust? 
• What should I consider in naming an executor? 
• How do I set up a durable power of attorney? 

Look for an estate planning attorney in the Super Lawyers directory for legal help.