When Aretha Franklin died intestate—without a legal will—in 2018, she joined a surprisingly long list of famed people who also did not leave behind a will. The lack of a will left her survivors with the hassle-laden task of settling her affairs. While your estate may not be the size of a pop star's, it's still important to have a plan in place in the event of your death.

More Than a Last Will and Testament

Estate planning goes beyond drafting a will. Planning means accounting for all of your assets and ensuring they transfer as smoothly as possible to the people or entities you wish them to go. Along with implementing your plan, you must make sure others know about it and understand your wishes.

If you've procrastinated on determining who inherits your estate, this article will help you get going in the right direction.

1. Itemize Your 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, art and antiques, computers or laptops, lawn equipment, and power tools.

The list will probably be a good deal longer than you expected it would be at the outset. As you make this list add short notes if there is a particular survivor you wish to have this item after your death.

2. Follow with Non-Physical Items

Next, start adding up your non-tangible assets to your list. These items 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 other existing insurance policies such as long-term care, homeowners, auto, disability, and health insurances.

Include all account numbers and list the location of the physical documents if you have them in your possession. You may also list contact information for the firms holding these non-physical possessions.

3. Assemble a List of Debts

Here, you will make a separate list for open credit cards and other obligations you may have. This should include items such as auto loans, existing mortgages, home equity lines of credit (HELOC), and any other debts you might owe. Again, add account numbers, the location of signed agreements, and the contact information of the companies holding the debt.

Include credit cards you use regularly and those sitting in a drawer that you never use or those from a store that you have. 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.

4. Make a Memberships List

If you belong to certain organizations such as the AARP, The American Legion, a veteran's association, professional accreditation association, or a college alumni group, make a list of them. In some cases, several of these organizations have accidental life insurance benefits (at no cost) on their members and your beneficiaries may be eligible.

Include any other charitable organizations that you proudly support or make donations to. It's also a good idea to let your beneficiaries know which charitable organizations or causes are close to your heart and that you support or make donations to.

5. Make Copies of Your List

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 (more on them later). 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.

2:43

Estate Planning: 16 Things To Do Before You Die

6. Review Your Retirement Accounts

Accounts and policies where you designate beneficiaries will pass directly to that person or entity listed at your death. It does not matter how you direct these accounts or policies be distributed in your will or trust. The beneficiary designations associated with the retirement account will take precedence.

Contact your employer's 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 current and listed exactly as you like. This is especially important if you have divorced and remarried.

7. Update Your Insurance

As with retirement accounts, life insurance and annuities will pass by contract as well. It is just as important that you contact all life insurance companies where you maintain policies to ensure that your beneficiaries are up-to-date and listed correctly.

8. Assign TOD Designations

Probate is a process where your assets are distributed per court instruction. It can be a costly and time-consuming process. Assets bequeathed in a will go through probate, as do assets if someone dies intestate.

However, many accounts such as bank savings, CD accounts, and individual brokerage accounts are unnecessarily probated every day. If you hold these accounts, they can be set up—or amended—with a transfer on death feature (TOD) to avoid the probate process.

Contact your custodian or bank to set this up on your accounts.

9. Draft 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 compose.

Most attorneys can help you with crafting a will for less than $1,000. If that's too rich for your blood, there are several will-making software packages available online for home computer use.

Your estate administrator or executor will be in charge of administering 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.

Make sure that you always sign and date your will, in front of two, non-related witnesses who should also sign the document. Then, have the will notarized. Keep the original in a safe place. Finally, make sure other people know the location of the document so they may access it when needed.

10. Copy the Administrator

Once your will is finalized, signed, witnessed, and notarized, you will want to make sure that your estate administrator gets a copy. Unless you are hanging onto the original yourself, you should also keep a copy in a safe place at home.

Bear in mind that, while you can make copies, only the original will—the "wet signature" document, in estate-planning lingo—can be filed for probate.

11. Regularly Review Documents

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

12. Visit 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. Professionals will also be up on changes in legislation and income or estate tax laws, which could impact your bequests. You might need to restructure your holdings.

13. 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. Consolidating of accounts allows for better investment choices, lower costs, a larger selection of investments, less paperwork, and easier management.

14. Other Important Documents

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

The Bottom Line

Procrastination is the biggest enemy of 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 paid (possibly unnecessarily) in federal tax.

So, 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. To quote Benjamin Franklin, “By failing to prepare, you are preparing to fail.”