4 Estate Planning Resolutions to Make for the New Year

By Susan Link

In my many years as an estate planning attorney at Maslon LLP, I have enjoyed helping clients plan ahead for the future—for the good things, and the not-so-good. If, like many people, you have put off taking steps to ensure your legacy is preserved and your loved ones provided for, what better time than the new year?

I recommend checking these important estate planning items off your New Year’s resolutions list:

1. Draw up a Health Care Directive when children turn 18. A common misconception is that parents can make health care decisions for their children who are age 18 or older, especially if the parents are paying the medical bills. They can't.

Once a child or grandchild reaches the age of 18, they are legally an adult and need to sign a Health Care Directive in order to allow their parents—or another person if they so choose—to make decisions regarding their health care in the event that they are unable to do so themselves.

In addition, the federal Health Insurance Portability and Accountability Act (HIPAA) prevents medical providers from sharing confidential patient information with anyone other than the patient or people specifically designated by the patient. If your adult child or grandchild is hospitalized or receiving other medical treatment and you have questions or want to discuss any concerns with their medical providers, those health care providers will not be able to talk to you about any protected medical information without written authorization from the patient.

To get started, consider this sample Health Care Directive form from the Minnesota Attorney General’s Office.

2. Update your Beneficiary Designations. Check to make sure the beneficiaries you have listed in your retirement accounts and life insurance plans are current.

Have you recently gotten married or divorced? Welcomed a new child or grandchild into the family? Retirement accounts and life insurance proceeds are not distributed through a provision in your will; these accounts are paid out directly based on the individual or individuals you have listed on your beneficiary designations.

I have seen many cases where, after listing their spouse as primary beneficiary, a person has listed their “living children” as contingent beneficiaries on the life insurance and retirement accounts—when those “living children” are minors. Children under age 18 do not have the legal capacity to sign the claim forms and therefore cannot receive the assets their parents wanted to leave to them. What happens then? The funds are very inconveniently deposited with the Probate Court until the child attains age 18—not a good result.

In Minnesota, if you are married and want the money in your retirement account to go to someone other than your spouse, your spouse needs to sign a spousal waiver giving their permission.

Most updates can be made online. If you are not sure how to do so, contact the account administrator.

3. Make or review your Personal Property List. A Personal Property List is a separate document from your will where you name the individuals to whom you want to give your tangible possessions such as jewelry, artwork, furniture, tools, or other such items.

In my experience, because of their sentimental value, these are often the items most likely to trigger family conflict. Make sure your children, grandchildren, or cousins don’t have to argue about who will get Grandma’s yellow pie plate, your wedding band, or your collection of Pokémon cards.

The Personal Property list can be updated at any time without also updating your will. If you do update the list, be sure to date and sign it, and clarify whether you intend to revoke any previous list(s).

4. Ensure that your estate plan reflects your charitable priorities. Want to leave some of your assets to a favorite charity? Naming the charity in your will is one way to do this, as long as you have money in a bank account that will become part of your estate.

Otherwise, consider adding the charity as a primary or secondary beneficiary on your retirement accounts and/or life insurance policies. I recommend sharing this information with a trusted family member or friend so that your intentions about where you want your money to go are clear.