As you’re preparing for the holidays, it’s perfectly normal to reminisce about what’s changed in the past year: new grandchildren, a home sale, a family move, a shift in health, or maybe even a new outlook on what truly matters to you. Those life events are exactly why reviewing your beneficiaries, Powers of Attorney, and Health Care Directives are so important, and should become a year-end habit.
These documents probably don’t cross your mind every day, but they quietly carry enormous weight. They determine how your assets will be distributed, who can act on your behalf, and how your wishes are honored if you’re unable to communicate them. Over time, even well-crafted plans can drift out of alignment.
Check your beneficiary designations.
Beneficiary designations on IRAs, 401(k)s, HSAs, TOD accounts, life insurance policies, and annuities override what’s written in your Will. That means if those forms don’t reflect your current wishes, the wrong person could inherit the account, even if your estate documents say otherwise. Changes like a child’s marriage, a divorce, or the passing of a family member could make a significant difference.
Take a few minutes to confirm if the listed individuals or charities are still correct. Do the distribution percentages add up as intended? Are contingent beneficiaries (backups) listed? Have you added or removed accounts since your last update?
Revisit your Powers of Attorney.
A Durable Power of Attorney (POA) designates someone to make financial decisions on your behalf if you’re unable to. For retirees, this is one of the most important safeguards for independence and peace of mind.
Consider whether the person you’ve chosen is still willing and able to serve. Do your documents grant appropriate authority to manage today’s digital and financial environment? Is a successor named, in case your first choice can’t serve? If you split time between states, make sure your documents comply with your primary state of residence. A quick review of these details each year helps to prevent confusion or court involvement later.
Update Health Care Directives and Living Wills.
Healthcare preferences and family circumstances evolve. Review your Advance Medical Directive to ensure that your healthcare proxy will understand your wishes for treatment, quality of life, and end-of-life care.
Does your current proxy still live nearby and understand your values? Have you shared a copy with your doctor, attorney, and loved ones? Have you discussed what matters most to you in medical decision making? These conversations can be difficult but offer significant clarity for your family.
Organize your documents.
Having your documents organized and available is equally as important as confirming they reflect your wishes. Make sure your beneficiary designations match the intent of your estate plan. Verify your attorney, financial advisor, and CPA have updated copies. Keep your originals in a safe place and tell your trusted contacts where they’re stored and how to access them if needed.
Life constantly changes, relationships evolve, and your financial picture shifts over time. Reviewing these documents each year is an opportunity to bring your intentions back into focus, and to make certain your wealth, values, and legacy are aligned. It’s an excellent gift you can give to yourself and your family.
If you’d like guidance on coordinating these updates, don’t hesitate to reach out. We’re happy to review your financial accounts alongside your attorney and tax professional.
Disclaimer: The information above is for general educational purposes only and should not be considered financial, tax, or legal advice. Always consult with a qualified professional regarding your specific situation. You should consult with your CPA and/or attorney before implementing any estate planning, gifting, or tax-related strategy.