How to Help Employees with Estate Planning

Many people believe that estate planning is only for the wealthy. It is actually a critical component of financial well-being for every adult, regardless of age. Once started, estate planning should be thought of as an ongoing process that includes much more than writing or updating a will.  A true “estate plan” includes declaring who can make decisions on your behalf if you are incapacitated, who takes care of your dependents, and how to avoid unnecessary taxes and waiting periods.

Unfortunately, the majority of people never take the time to document their wishes should something happen to them. In MSA’s 2023 poll of over 3,000 employees, we learned that 81% of employees do not have an estate plan and that over 50% are not confident they have proper life insurance coverage.¹ To help people get started, MSA Money Coaches often say that “if you drive a car, have a pet, or own anything of value, estate planning is a must.”

Employers: the financial well-being services you already offer may help employees get started with estate planning.

A great time for employees to learn about the importance of estate planning is when employers promote financial well-being resources to their workforce. Some organizations have a direct relationship with financial well-being programs, such as MSA (My Secure Advantage, Inc.), or they have financial coaching resources accessible through their Employee Assistance Program (EAP). Coaching sessions are typically over the phone for thirty minutes. Getting educated on the financial aspects of estate planning is a great example of a conversation worth having with a Money Coach.

Estate Planning Checklist

If an employee were to speak with a Money Coach about estate planning, they might leave the conversation with a to-do list that looks like the following:

1. Complete advance health care directives: There are legal documents that specifically address a person’s wishes for care if they become unable to advocate for themselves. A “living will” typically details a person’s health care preferences, while a “health care proxy” is a durable power of attorney that appoints someone to make medical care decisions on another person’s behalf when they can’t make decisions themselves.

2. Create an inventory of everything you own of value. Revisit your list multiple times to ensure you have included everything.

• Physical assets such as a home, cars, jewelry, art, furniture, etc.
• Financial and digital assets like bank accounts, 401(k)s or IRAs, investment accounts, cryptocurrencies, digital documents and photos you may store in the cloud, etc.
• Wholly or partially owned businesses or real estate
• Life insurance policies or annuities
• Lastly, include any mortgages, loans, credit card balances, or any other debts you are obligated to pay

3. Determine what it means for your family or interests to be “taken care of.” Examples may include:

• Covering family’s monthly lifestyle expenses for some period of time
• Guardians selected to take custody of minor or disabled children
• If desired, specific wishes regarding children’s education (private or public schools)
• Care of pets in your absence
• Charitable donations

4. Decide if you need an attorney. At this point, it will become clear if you have a simple estate or could benefit from the advice of an attorney. There are many online resources for legal documents, but you might want to ask family and friends if they have used an attorney and felt the results were worth the cost. Consider your assets, family dynamics, and whether you want to consider creating a trust. The more complex your estate and wishes are, the more you will benefit from the services of an estate attorney.

5. Choose or update beneficiaries for any financial assets. As part of the exercise, designate secondary beneficiaries on all accounts should something happen to the primary beneficiaries.

6. Talk to anyone you are empowering to carry out your wishes to ensure they are willing to follow your instructions. This could be someone you want to be the guardian of your children, someone to make medical or financial decisions on your behalf if you are incapacitated, or the person you want to execute the instructions you leave in a will (executor).

7. Create a letter of instruction (will) and designate an executor to carry out the wishes you document. You need to make sure that your will is valid in the state where you reside. If you hire an attorney, you will be guided through the necessary documents to satisfy your wishes and abide by state laws.

As you can see from the checklist, there are several actions every adult should be reminded to take in order to have peace of mind that whatever they value will be properly cared for should something happen to them. Most employers simply need to promote the benefits or resources that employees already have access to.  A little education will help employees understand that many estate planning tasks do not require an attorney and that their employer has provided resources to help them.

Interested in estate planning resources for employees? If you want to learn more about MSA’s financial well-being solution, contact us today.

¹ Based on My Secure Advantage Inc. member survey data collected from attendees prior to a live streaming event in October of 2023.