Taking Stock: Are your assets covered?

It’s difficult to talk about asset and estate planning because it tends to remind us of our own frailties and eventual demise. In some cases, it can be even more disturbing to think about becoming incapacitated than it is to consider the possibility of death.

However, even though it’s unpleasant to consider these outcomes, it’s necessary to plan ahead — just in case. If you become unable to manage your own affairs, you need to know that someone else is looking after your best interests. Additionally, when you do pass on, you want your legacy to go to your posterity and others in a way that you approve of.

As your assets grow, it becomes even more important to plan ahead and make sure that you are prepared for various possibilities. Here are some items to consider as you take stock of your situation and work to ensure that your assets are put to good use in the way you think is best.

The first step is to consider the documents that instruct others as to how you want your assets managed when you can no longer oversee them. Here are some of the documents that you need to make sure that you have, depending on your situation:


Everyone should have a will, no matter the situation. A will provides direction about what should happen with your assets and belongings after you pass on. A will is also important since this is the document used to designated guardianship for your dependents. Creating a will is normally fairly simple. In fact, many attorneys have set prices for creating wills because they are common and follow a widely-used format.

You can’t make your will and forget about it, however. This is especially true if you make your will while you are still young. As your circumstances change throughout your life, it is vital that you update your will regularly, or even create a new one. Most lawyers can guide you through the process of updating or replacing your will. Anytime you experience a change in life circumstances (growing family, marriage, divorce, etc.) and as your wealth grows, it’s a good idea to revisit your will and make appropriate changes.


At some point in your life, there is a good chance that you will be unable to act for yourself. No matter how this incapacitation takes place, you need to be ready for the possibility by appointing someone with the ability to act on your behalf. The durable power of attorney is a document that designates someone to act as your agent in different circumstances. There are two different types of durable power of attorney:

  1. Finances: If you want someone to be able to manage your money while you are unable to, you provide them with this authority. Legal and financial decisions can be made with reference to your known wishes when someone acts in your name through the durable power of attorney.
  2. Healthcare: Don’t forget to designate someone to act on your behalf in making health care decisions. This person can take your wishes into account when deciding on your treatment, including — if applicable — end of life care.

You don’t have to choose the same person to represent in you both types of power of attorney, if you don’t want to. In order to appoint someone as your agent, you need to be “of sound mind.” It’s important that you prepare durable power of attorney paperwork now, so that you aren’t out of luck later.

Without someone to act on your behalf, your family and other loved ones may not be able to make vital decisions about your situation, engage in financial and Medicare planning, or take other action designed to keep your estate and your health in the best possible condition.

There are several different choices for preparing a power of attorney document, including provisions for when the agent takes over for you, as well as what he or she is empowered to do. It’s best to get the help of a knowledgeable and trusted attorney as you have this documentation prepared.


A health care directive is sometimes called a “living will.” This is the document that describes your wishes when it comes to health care. Your agent (as designated by your health care durable power of attorney) should be aware of the health care directive and know your wishes. It’s also a good idea to let other loved ones know about your wishes so there isn’t a lot of wrangling over it. This is especially important if you have wishes regarding your end-of-life care, or opinions about whether or not you should be kept alive with extraordinary measures.


Not everyone needs a trust for their assets. However, as your net worth grows, or if you have a business, or if you have other circumstances that make it practical, a trust can be a great estate planning tool.

With a trust, you sign over your assets to the trust, which is managed by others. It is usually possible for you to be one of the trustees. A trust offers you the ability to reduce tax consequences on your estate when you pass on. Additionally, a trust can make it a little easier for your posterity to manage your finances when you are unable to.

Speak with an estate planning specialist about which type of trust might be best for your circumstances. There are several different types of trusts with varying rules about how they are administered. Share your goals with your estate planning specialist so that he or she can help you structure a trust that benefits you and your heirs.

It’s always important to let your family know about your wishes. Your loved ones should understand your wishes, as well as have an idea of the assets you have and how you want them managed. As you create your overall estate plan, here are some of the people that you need to involve:

  • Executor: This is your personal representative. This is the person in charge of making sure that everything is done according to your wishes. Your will should have an executor who can oversee the terms of the will.
  • Trustee: You will need someone to run your trust and manage your assets. In many cases, you should appoint more than one trustee. That way, you don’t have all the decisions made by a single person. Your trustees together can come to a decision. You can include an investment advisor as a trustee as well.
  • Guardian for your children: If you have children below their majority, you need to appoint someone to stand in for you, should you die before they are old enough to take care of themselves. Choose someone willing to take on the task, as well as someone you trust to manage your children’s money.
  • Healthcare proxy: This is the person designated to make health care decisions on your behalf.

All of the people you involve should those you trust to make decisions in line with your wishes. Carefully consider your choices, and make sure your family is aware of your decisions as well.

Now that you have managed your documentation, it’s time to tie it all together. You do need to make sure that everyone close to you is aware of your arrangements and wishes. Keep your documents in a safe place. A document safe that is designed to be fireproof and waterproof is one of the best options for you. You can also make digital copies of your documentation for storage in the cloud. Additionally, those important people mentioned should have copies of your documentation, along with your attorney.

Don’t forget about your digital assets, either. Keep a list of accounts and passwords in a safe, or in an encrypted file. This list should include account access information for social media accounts, email, and online investment and bank accounts. Many social media sites allow for your account to converted to a memorial account. If you want that as an option, make it known and follow the required steps. You can also designate that your accounts be deleted, if you prefer.

Finally, over time, make sure you review your paperwork and make updates. This is especially important when it comes to beneficiary designations, like those for retirement accounts and life insurance policies. Beneficiary designations always trump what you have written in your will or other paperwork, so you want to make sure it’s updated.

Review this information every year. Sometimes, you won’t need to make any changes at all. However, getting into the habit ensures that you think about your planning each year, and that you don’t forget about making necessary changes.

With the right planning, and regular review of your documentation, it is possible for you to plan for the proper disposition of your estate in the future — and it can provide you with peace of mind now.

investing for retirement ebook ipad - McClain Lovejoy
investing for retirement ebook ipad - McClain Lovejoy
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