Last week was National Estate Planning Week — a reminder for me to nudge you to "do estate planning." I received great feedback when I published estate planning advice last year, soon after my father died.
A year later, I have fine-tuned a few things, but must say emphatically that while you should consult with and hire a qualified estate attorney to help you through the process, estate settlement requires a lot of work from the executor, so be prepared!
Before a death, here are the basic documents you will need:
Letter of instruction
Power of attorney
Health care proxy
Trusts — not necessary, but many people have either revocable (changeable) or irrevocable (not changeable), depending on family and tax situations
DNR or "do not resuscitate" order: This may need to be completed upon each new admission to a hospital or nursing home.
List of all bank accounts
List of all user names and passwords
List of automatic pay accounts with name and contact information of each payee
List of safe-deposit boxes
IRAs, Roth IRAs
Brokerage account information: name, contact phone number and email address
Detailed list of savings bonds, and copies of actual bonds
Life insurance policies (private and through employer)
Long-term-care insurance policies
Housing, land and cemetery deeds
Proof of loans made
Partnership and corporate operating agreements
Previous three years' tax returns
Military discharge information
List of contact information: contacts on accounts, names, current addresses and Social Security numbers of all people named in your legal documents, as well as the contact information for the estate attorney and CPA who will be handling the estate
After completing all of this hard work, you need to inform your executor as to where everything is stored. My father actually made sure that I had an executed copy of all the documents, which was helpful.
After death, things get complicated, because you have to shift between grieving and doing. I learned not to go too fast with my mother, so she did not feel overwhelmed. It's helpful to remember that everyone in the family grieves in different ways, which is why patience and compassion often are your most valuable commodities during the process.
I found solace in a spreadsheet, which helped me keep track of the estate settlement progression, but you can use any system that works for you. Just remember that there are usually many moving parts, and you may not be at the top of your game for remembering everything that needs to get done. A visit to your favorite stationery store will help you keep records of everything stored neatly in one location.
Request plenty of death certificates
Some institutions want originals, not copies, and it's easier to make the request from the funeral home, not after the fact from the city or state.
Keep track of all bills attributable to the estate
These include funeral and memorial arrangements, death notices and other ancillary expenses. The estate can reimburse individuals for these costs.
Contact the estate attorney
When you are ready, schedule time to meet with the estate attorney. He or she will likely tell you to gather documents and to ascertain a date of death valuation for all accounts to which the deceased held title. If there is a surviving spouse, you should itemize what is in both the living and deceased spouse's names.
Contact the CPA
Even if there are no estate taxes due, in most cases it will be necessary to file an estate tax return. If you prepare your own taxes, it may make sense to hire a pro to help you through the process.
A well-planned estate is a wonderful legacy you can leave your heirs — instead of untangling a messy estate, they can follow concrete steps, allowing them to take care of business while mourning their loved one.
Jill Schlesinger, a certified financial planner, is a CBS News business analyst. She welcomes emailed comments and questions.