Here’s a DIY fix for your estate plan. Every estate plan should have at least three elements: a will or trust; a health care directive; and a financial power of attorney. A fourth and final element is a letter of instructions for survivors. This is your job. It’s not that difficult to do for most of us, but it needs to be done and updated periodically
It doesn’t need to be in two parts, but often it should be. The first part contains limited information about how to get into your home, how to find your estate plan and financial documents and perhaps information about your funeral and memorial service wishes. Secondly, you really should prepare a more detailed list of instructions and guides to aid your personal representative, trustee(s) and your agents under your health care directive.
The first letter
This can be sent to interested family members or just the fiduciary appointed by your estate plan. It should give them information as to where you store your financial records and your estate planning documents. You may add information about your funeral and memorial service preferences and if you have prepaid or otherwise provided for these expenses. Depending on your wishes, you may want to include details that are otherwise provided by the second letter detailed below. If you have made unusual gifts, or intentionally omitted a child, you should consider letting them know in advance either by in person conversations or in this first letter.
The second letter
This letter should include detailed information on your financial accounts (where held, account numbers, person to contact) and if you have beneficiary designations on the accounts (also TOD and POD designations). Let them know where to find your tax returns and current tax files as well as contact information for your tax preparer. Provide insurance information (e.g. policies, agent). If you have a safe deposit box, where the box is located, where the key is, and who is authorized to access the box. List charge cards you own, and where they are kept. Also list recurring charges that are authorized to your bank account(s); passwords for devices, accounts and social media. Provide account and password information for storage of files and photos if in the cloud. If located at your residence, indicate where you keep your electronic storage.
You might want a list of people to contact after you have passed on. List where you keep house keys, car keys and remotes for the garage doors if any. Special instructions may be needed for taking care of your home(s). There may be items you have of value, that may not appear to be valuable, such as antiques, coin collections or jewelry. Let your family know any estimates of value and where they are located. This may be as long or as short as you feel necessary. I have one client that has a 30 page letter of instructions. That’s an outlier. Just remember, the goal is to make things easier for your family after you have passed on.