Estate planning 101: How to get started

Estate planning can be a tricky business.

There’s that issue of mortality. Maybe you would rather avoid family drama. Or maybe you’re a procrastinator and have given it little thought.

Jim Platania, president of Arlington Heights-based Platania Financial, Inc., takes the intimidation factor out of estate planning. The Daily Herald reached out to Platania, a certified financial planner, for his tips, a kind of beginner’s guide. Call it “Estate Planning 101.”

“If they don’t have a plan, the state will make a plan for them,” Platania cautioned.

Choosing beneficiaries

“You could have a savings account, you could have a CD, you could have an investment account, a mutual fund, and many people don’t realize that they can list the beneficiary on those accounts,” Platania said. “And often they don’t.”

Why does that matter?

“When you have a beneficiary listed, it’s really like a will substitute,” Platania said. “It’ll go to those people without probate, and you don’t have to do anything for them to get that money.”

Getting organized

Create an inventory of all your assets, Platania advises. Make a list of who you want to receive those assets — and how.

He recommends seeing an attorney to draw up a will or a trust based on specific needs.

“The lawyer is going to want to see what kind of assets do you have. How are they titled? Are they retirement accounts? Are they nonretirement accounts?”

If you don’t know a qualified attorney, do your research. Call a few and ask what would you charge for a will? What do you charge for a trust? Would you charge for a consultation?

“In my opinion, people have worked very hard for their assets. I would prefer to sit with someone face to face,” Platania said.

Also important: determining who will act as a financial power of attorney and a health care power of attorney.

“Maybe your dad died first, then your mom is alone, and she becomes incompetent, and she really can’t sign anything … who’s going to act on her behalf financially? And if you don’t have a power of attorney for the financial part of her life,” Platania said, “it’s almost like dying without a will.”

Keep it updated

Too often, Platania said, people put together an estate plan and they never revisit it, “and that’s a problem.”

“They need to review their beneficiaries ... to make sure that any personal changes in their life are going to be reflected in those documents,” he said.

As for the emotional side of the equation, you may also want to write more of an informal letter about your last wishes.