Estate Planning Checklist: Get Started Planning in 3 Simple Steps

Estate planning is the process of making arrangements for all of your belongings and assets after you’ve passed on. If you don’t create a plan for your assets, the state will likely get involved. This could lead to a long and expensive legal battle for your loved ones.

Fortunately, starting your estate plan is as simple as speaking with an estate planning strategist. If you’re ready to start planning, consider scheduling a free consultation with the team at ARQ Wealth Advisors. Or, continue reading to learn how to start estate planning. 

Step #1: Itemize Your Belongings

The first step in estate planning is to review your assets and create a master list of all your belongings. Creating a detailed list of everything that you own will help make the planning process much simpler down the road. 

The key during this step is to be incredibly thorough and jot down all of your assets and financial accounts. This includes tangible assets like:

1. Your home or any other real estate holdings
2. Automobiles
3. Furniture
4. Collectibles
5. Artwork 
6. Jewelry 

However, be sure to also include intangible assets like:

1. Checking and savings accounts
2. Investment accounts
3. Retirement accounts (401(k)s, IRAs, etc.)
4. Business interests  
5. Insurance policies  
6. Digital assets or wallets

Collect Recent Values For Assets and Liabilities

While creating your master list, you should also collect up-to-date values for each asset. This will make it easier to calculate the total value of your estate and get a sense of how you may want to distribute it among your beneficiaries. During this step, be sure to:

• Get the approximate value of investment or retirement accounts
• Have an appraiser calculate an up-to-date value for your home
• Record the cash value and death benefits of any insurance policies 

You’ll also want to list out all of your liabilities or outstanding debts. This can include your mortgage, credit card debt, or medical debt. Some types of debt, like joint or community property debt, will typically become your spouse’s responsibility after you pass away – an issue you’ll likely want to address during your estate planning.

Now that you’ve itemized your belongings and accounted for all assets and liabilities, it’s time to establish your beneficiaries. 

Step #2: Establish Your Beneficiaries 

Establishing your beneficiaries simply means answering the following questions:

1. Who do you want to inherit your assets?
2. What possessions (or how much money) do you want each beneficiary to receive?

If you have an extensive estate or family, answering these questions can feel overwhelming. An easier place to start is by listing your immediate family members and their needs. This will help give you a clear image of each of your beneficiaries’ financial needs and who might stand to gain the most from your estate.

Establishing your beneficiaries and creating a plan ahead of time can help reduce potential conflicts among your family down the road. If you do not leave clear instructions for your assets, then multiple family members could try to claim your possessions.

Step #3: Speak With an Estate Planning Strategist

Steps #1 and #2 are the easiest part of the estate planning process. However, implementing your plan gets much more complicated as it involves drafting legal estate planning documents, minimizing your estate taxes, and ensuring that nothing slips through the cracks. 

If you’re looking for one of the most talented teams of financial advisors and estate planning strategists in Arizona, look no further than ARQ Wealth Advisors. 

ARQ Wealth offers incomparable retirement planning services and estate planning advice. One of our core beliefs is that each client deserves white glove service. To achieve this, we limit each advisor to just 60 clients, significantly below the industry average of 120 clients per advisor. 

Schedule your free consultation with an ARQ Wealth estate planning strategist today.

Write a Will

A last will and testament – also known simply as a will – is a legal document that describes how you want your belongings to be distributed after your death. This document will include all the information you documented earlier, such as your assets and beneficiaries. It is important to work with a professional when drafting this legal document to ensure that all of your belongings are accounted for and that the will follows all of your state’s legal requirements.

Grant Power of Attorney

Power of attorney (POA) is a phrase that describes giving someone else (known as your “agent”) the legal authority to make decisions on your behalf. Several different types of POA may be relevant to your estate planning process:

1. Financial Power of Attorney: Granting your agent the authority to make financial decisions on your behalf.

2. Medical Power of Attorney: Granting your agent the authority to make medical decisions on your behalf.

3. General Power of Attorney: Granting your agent the ability to make general decisions on your behalf. This agent can buy insurance policies, conduct business transactions, make gifts, or employ professional help.

It’s also important to note that you can assign POA to multiple people. This can be useful if you want one person to take authority over your finances while another is responsible for your medical decisions. You can also revoke the POA at any given time if your circumstances change.

Establish a Trust

One of the last steps to planning your estate is to establish a trust. A trust is a legal arrangement that ensures that your assets go to specific beneficiaries. There are three main roles involved in a trust:

1. Grantor: The person who creates the trust and puts their assets in it
2. Beneficiary: A person who receives some or all of the assets in the trust
3. Trustee: The organization or person who administers the trust

To help distribute their assets, the grantor creates a trust and puts their assets into it. The authorized trustee(s) distributes these assets to the beneficiaries in a pre-determined manner. Here are some of the main benefits of using a trust:

1. Control: Trusts create detailed rules on how your assets will be distributed. You can even set limits on when your beneficiaries will receive assets or cash and how they can spend it.
2. Privacy: Trusts can help your assets avoid going through probate court (which becomes public record). Avoiding probate court helps keep your estate and assets private. 
3. Ease: By avoiding probate court, trusts also help your assets get distributed to your beneficiaries more quickly.

There are many different types of trusts, each with its own uses and benefits. You can learn more by speaking with a professional to help determine which trust is best for you.  

Create a Guardianship Plan

If you are the sole guardian of minor children or grandchildren, you will also want to plan for who will take over guardianship when you pass away. Many people also choose to include a guardianship plan for pets.

Estate Planning Tips: What Else to Know

Here are some extra tips to help you plan effectively:

Update Your Estate Plan Regularly 

It’s important to remember that your life can change quickly. Each year can bring exciting new developments like welcoming a child, buying a new house, or entering a new relationship.  However, each of these developments can potentially disrupt your existing estate plan. This is why it’s important to update your estate plan regularly. 

At ARQ Wealth, we typically recommend revisiting your estate plan once a quarter (or at least once a year) to ensure that nothing needs to be updated.

What Happens if I Have No Estate Plan in Arizona?

If you pass away with no estate plan in Arizona, your estate will be distributed according to the Arizona Revised Statutes. The distribution of your assets will depend on your legal relationship with surviving relatives.

• Surviving spouse: Your surviving spouse will be entitled to a portion of your estate.
• Children and descendants: Children or other descendants who survive you will be entitled to a portion of your estate.
• Parents and Siblings: If you die without a will and have no surviving spouse, children, or descendants, your estate may pass to your parents or siblings. If you have surviving parents but no children or descendants, your parents will inherit your entire estate in equal shares.

Creating an estate plan as soon as possible is the best way to ensure your assets are distributed according to your wishes. 

Do I Need an Estate Planning Attorney?

While you can handle parts of the estate planning process yourself, it’s usually best to employ a professional. 

Creating an estate plan is a fairly complex endeavor that involves deciphering the tax code to stay compliant with your state’s requirements. It also involves creating the necessary legal documents and entities. This task can get complicated quickly, especially if you have a significant estate. 

Employing the help of a wealth management professional and an estate planning attorney can help you simplify the process while also minimizing your estate taxes.

Is Estate Planning Only For the Wealthy?

No. Although the term “estate” can conjure up images of sprawling manors, estate planning is a crucial task that everyone should do, no matter how modest your estate is. Estate planning is the culmination of your life’s work and helps ensure that all of your belongings are passed down according to your wishes. This is why estate planning is a task that everyone should consider.

Interested in planning your estate? Speak with one of the estate planning strategists at ARQ Wealth today. Contact us online or call 480-214-9572 to set up an appointment.