While it is important to have an updated estate plan, there is a lot of information that your heirs should know that doesn’t necessarily fit into a will, trust or other components of an estate plan. The solution is a letter of instruction, which can provide your heirs with guidance if you die or become incapacitated.
A letter of instruction is a legally non-binding document that gives your heirs information crucial to helping them tie up your affairs. Without such a letter, it can be easy for heirs to miss important items or become overwhelmed trying to sort through all the documents you left behind. The following are some items that can be included in a letter:
- A list of people to contact when you die and a list of beneficiaries of your estate plan
- The location of important documents, such as your will, insurance policies, financial statements, deeds, and birth certificate
- A list of assets, such as bank accounts, investment accounts, insurance policies, real estate holdings, and military benefits
- Passwords and PIN numbers for online accounts
- The location of any safe deposit boxes
- A list of contact information for lawyers, financial planners, brokers, tax preparers, and insurance agents
- A list of credit card accounts and other debts
- A list of organizations that you belong to that should be notified in the event of your death (for example, professional organizations or boards)
- Instructions for a funeral or memorial service
- Instructions for distribution of sentimental personal items
- A personal message to family members
Once the letter is written, be sure to store it in an easily accessible place and to tell your family about it. You should check it once a year to make sure it stays up-to-date.
For my clients, I provide an information organizer to accomplish many of the goals listed above.
If you are interested in receiving a free copy of my Ultimate Organizer, click below!