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While many of us like to think that we're immortal, the old joke is that only two things in life are for sure: death and taxes. Not only is it important that you have a plan in place in the unlikely event of your death – no one expected to lose Prince so soon – but you must also implement your plan and make sure others know about it and understand your wishes. As Benjamin Franklin's famous quote goes, “By failing to prepare, you are preparing to fail.”

Unless Prince's mysterious vault ends up containing a will, he died intestate – and perhaps didn't tell anyone his thoughts about or plans for his estate. If you've procrastinated on yours, this article will help you get going in the right direction.

1. Do a Physical Items Inventory

To start things out, go through the inside and outside of your home and make a list of all items worth $100 or more. Examples include the home itself, television sets, jewelry, collectibles, vehicles, guns, computers/laptops, lawn mower, power tools and so on.

2. Follow with a Non-Physical Items Inventory

Next, start adding up your non-physical assets. These include things you own on paper or other entitlements that are predicated on your death. Items listed here would include: brokerage accounts, 401k plans, IRA assets, bank accounts, life insurance policies, and ALL other existing insurance policies such as long-term care, homeowners, auto, disability, health and so on.

3. Assemble a Credit Cards & Debts List

Here you'll make a separate list for open credit cards and other debts. This should include everything such as auto loans, existing mortgages, home equity lines of credit, open credit cards with and without balances, and any other debts you might owe. A good practice is to run a free credit report at least once a year. It will identify any credit cards you may have forgotten you have. Top Places to Get a Free Credit Score or Report will direct you to the best sources.

4. Make an Organization & Charitable Memberships List

If you belong to certain organizations such as the AARP, The American Legion, Veteran's associations, AAA Auto Club, College Alumni, etc, you should make a list of these. Include any other charitable organizations that you proudly support or make donations to. In some cases, several of these organizations have accidental life insurance benefits (at no cost) on their members and your beneficiaries may be eligible. It's also a good idea to let your beneficiaries know which charitable organizations are close to your heart.

5. Send a Copy of Your Assets List to Your Estate Administrator

When your lists are completed, you should date and sign them and make at least three copies. The original should be given to your estate administrator (we'll talk about him or her later in the article). The second copy should be given to your spouse (if you're married) and placed in a safe deposit box. Keep the last copy for yourself in a safe place.

6. Review IRA, 401(k) and Other Retirement Accounts

Accounts and policies in which you list beneficiary designations pass via "contract" to that person or entity listed at your death. No matter how you list these accounts/policies in your will or trust, it doesn't matter because the beneficiary listing will take precedence. Contact the customer service team or plan administrator for a current listing of your beneficiary selection for each account. Review each of these accounts to make sure the beneficiaries are listed exactly as you like.

7. Update Your Life Insurance & Annuities

Life insurance and annuities will pass by contract as well, so it's just as important that you contact all life insurance companies where you maintain policies to ensure that your beneficiaries are listed correctly.

8. Assign TOD Designations

TOD stands for transfer on death. Many accounts such as bank savings, CD accounts and individual brokerage accounts are unnecessarily probated every day. Probate is an avoidable court process through which assets are distributed per court instruction, which can be costly. Many of the accounts listed above can be set up with a transfer-on-death feature to avoid the probate process. Contact your custodian or bank to set this up on your accounts.

9. Select a Responsible Estate Administrator

Your estate administrator will be responsible for following the rules of your will in the event of your death. It is important that you select an individual who is responsible and in a good mental state to make decisions. Don't immediately assume that your spouse is the best choice. Think about all qualified individuals and how emotions related to your death will affect this person's decision-making ability.

10. Create a Will

Everyone over the age of 18 should have a will. It is the rulebook for distribution of your assets and it could prevent havoc among your heirs. Wills are fairly inexpensive estate planning documents to draft. Most attorneys can help you with this for less than $1,000. If that's too rich for your blood, there are several good will-making software packages available online for home computer use.

Make sure that you always sign and date your will, have two witnesses sign it and obtain a notarization on the final draft. If you have a family, Advice on Wills: Should Each Child Get the Same? will help you think through some of these issues.

11. Review & Update Your Documents

Review your will for updates at least once every two years and after any major life-changing events (marriage, divorce, birth of child, and so on). Life is constantly changing and your inventory list is likely to change from year to year too.

12. Send Copies of Your Will to Your Estate Administrator

Once your will is finalized, signed, witnessed and notarized, you'll want to make sure that your estate administrator gets a copy. You should also keep a copy in a safe-deposit box and in a safe place at home.

13. Visit a Financial Planner or an Estate Attorney

While you may think that you've covered all avenues, it's always a good idea to have a full investment and insurance plan done at least once every five years.

As you get older, life throws new curveballs at you, such as figuring out whether you need long-term care insurance and protecting your estate from a large tax bill or lengthy court processes. Tips like having an emergency medical contact card in your purse or wallet are little things many people never think of that an expert can help you learn.

If you're not looking to spend the money for professional help – or want to minimize what it costs – reading can help you begin to get your financial plan and estate in check. Start with Investopedia's tutorial Become Your Own Financial Advisor. Then read Estate Planning Basics and In-Depth Guide to Estate Planning for specific help on the estate-planning aspects.

14. Initiate Important Estate-Plan Documents

Procrastination is the biggest enemy to estate planning. While none of us likes to think about dying, the fact of the matter is that improper or no planning can lead to family disputes, assets going into the wrong hands, long court litigations and huge amounts of dollars in federal tax.

At minimum, you should create a will, power of attorney, healthcare surrogate, and living will – and assign guardianship for your kids and pets. If you're married, each spouse should create a separate will, with plans for the surviving spouse. Also make sure that all the concerned individuals have copies of these documents.

15. Simplify Your Finances

If you've changed jobs over the years, it's quite likely that you have several different 401(k)-type retirement plans still open with past employers or maybe even several different IRA accounts. While this normally won't create a big problem while you're alive (except lots of additional paperwork and account management), you may want to consider consolidating these accounts into one individual IRA account to take advantage of better investment choices, lower costs, a larger selection of investments, more control and less paperwork/easier management when assets are consolidated.

16. Take Advantage of College Funding Accounts

The 529 plan is a unique tax-advantaged investment account for college savings. In addition, most universities do not consider 529 plans in the financial aid/scholarship calculation if a grandparent is listed as the custodian. The really nice feature is that growth and withdrawals from the account (if used for "qualified" education expenses) are tax-free.If you have grandchildren and the assets to do it, consider opening a plan for each grandchild.

The Bottom Line

Now you have the ammunition to get a pretty good jump-start on reviewing your overall financial and estate picture; the rest is up to you. While you're sitting around the house watching your favorite sports team or television show, pull out a tablet or laptop and start making your lists.

You'll be surprised how much “stuff” you've accumulated over the years. You'll also find that your inventory and debts lists will come in handy for other tasks such as homeowners insurance and getting a firm grip on your expenses.

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