If you successfully implement the strategies outlined in the financial management pyramid, you are much more likely to have assets left over at the end of your lifetime and will need a plan for how your accumulated wealth is to be distributed. A will is a necessity if you want to direct the distribution of possessions after death. Yet, almost 70% of the adults in the United States do not have wills. Many people think they do not need to prepare a will because they have so little, or it costs too much, or they will do it later when they have more time or get older. Dying without a will is called dying “intestate” and means that state regulations will determine the distribution of assets. By having a carefully written legal will, you can provide for your family and others in a manner consistent with your desires.
In addition, a variety of other important legal documents can make provisions for crises other than your death including the following: General Durable Power of Attorney, Health Care Power of Attorney, and a Living Will. These documents are best completed before a crisis occurs and can ease a difficult period for your family. These components of an estate plan are not directly linked to the financial management pyramid, but can protect assets and insure that your financial strategies and health care decisions are respected.
Another recommended action to take with respect to estate planning is to regularly review and update the beneficiaries and contingent beneficiaries of your legal documents, life insurance policies, and retirement savings plans. For a worksheet to record all your beneficiary designations in one place, see http://njaes.rutgers.edu/money/pdfs/beneficiary-designations.pdf.