Care for your heirs: 8 estate planning steps to take now

1. Organize paperwork and/or online files. Make sure your family and/or personal representative can find your insurance policies, deeds, titles, pension information and financial account records. For online accounts, keep a list of passwords in a safe place and let your personal representative/executor know where it is.
   
2. Retitle accounts to make it easier to pass them on without probate. One way is to use joint tenancy with right of survivorship, in which case the assets automatically pass in full to the joint owner upon your death. However, this also means your joint owner (and possibly his or her creditors) has full access to the assets while you're alive. To avoid that, you may want to consider payable on death accounts for savings or certificates, or transfer on death registrations for stocks, bonds and mutual funds. The beneficiary has no claim on the assets while you are alive, and you can change the beneficiary at any time.
   
3. Make a will. The most basic estate planning document, a will allows you to name beneficiaries, distribute personal property and, if you have minor children, name their guardians.
   
4. Review and update beneficiaries on insurance policies, employer-sponsored retirement plans, individual retirement accounts (IRAs) and annuities. Updating beneficiaries is especially important since these designations supersede your will instructions.
   
5. Create a living will and designate a health care proxy. Don't leave your loved ones guessing about the end-of-life care you would like to receive. Having instructions in place will spare them the burden of trying to guess what you would have wanted. You may be able to obtain these forms from your health care provider or your state department on aging.
   
6. Consider naming financial power of attorney. This will allow a trusted individual to take care of your financial affairs should you be incapacitated.
   
7. Spell out final wishes. Let your family know whether you prefer cremation or burial and what kind - if any - of funeral service you would like. If you've done preplanning, make sure your family has access to the contract.
8. Consider a trust. A trust may give you more control, more flexibility, help you reach charitable goals and - depending on the type of trust - may help save on estate taxes.

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