Having your estate plan in order is always a good idea, but it is essential if you will be traveling. Should anything happen to you during your trip, your loved ones would already be thrown into a difficult and emotional time. You can relieve them of that burden in the unlikely event that something happens to you by planning ahead.
Keep in mind that estate planning basics require that you take into account the possibility of either death or incapacitation, so this list includes tips pertaining to both situations. What follows is a simple estate planning checklist to consult before you travel.
1. Last Will and Testament
Everyone should have a will and, if you don't, before traveling is a great time to draw one up. If you already have a will, review it to make sure it still reflects your wishes and takes into account any recently acquired property or births, deaths, marriages, divorces, etc., since it was written.
2. Guardianship and Care of Minor Children
If you have children under the age of eighteen, you should, at the very least, name a guardian to physically take care of them in the event that something happens to you. You can do this in your will, and you can also make provisions for their financial well-being in the form of a testamentary trust, as well as naming someone to oversee their financial affairs.
If you have already created a living trust, make sure you have included all of the assets you would like to pass to beneficiaries, especially if you have acquired anything new since the trust was created. If you haven't yet created a living trust, you may consider it as an option for passing assets to your beneficiaries in a way that avoids the probate process.
4. Advance Directives: Living Will and Health Care Power of Attorney
An advance directive is a legal document that expresses a person's health care preferences for when you're unable to make those decisions for yourself. One of your top priorities should be to create a living will, one type of advance directive, before your trip (or, if you already have one, to make sure it's up-to-date). Living wills detail the medical directions you want followed in the event you become seriously ill or incapacitated and cannot communicate such directions yourself. Matters addressed usually include feeding and breathing tubes, life support, and life-sustaining procedures.
Another type of advance directive is a health care power of attorney, which gives someone else the authority to make health care decisions for you should you be unable to do so.
5. Durable Power of Attorney
A durable power of attorney or financial power of attorney grants someone of your choice the authority to make decisions for you if you are unable to do so. You can specify the duties they can perform, which may include handling financial and legal claims, dealing with insurance and retirement benefits, managing property, entering contracts for services, and more. A durable power of attorney remains in effect even if you become incapacitated.
6. HIPAA Authorization
The Health Insurance Portability and Accountability Act (HIPAA) requires most health care providers and insurance companies to protect the privacy of patients' health care information. It is desirable to have a separate signed HIPAA authorization to allow the person of your choice to have access to your medical records, because a power of attorney only takes over if you are declared incompetent. You may very well need someone else to be able to get access to your health information before that.
7. Life Insurance
It is particularly important to be sure your life insurance policies are updated before traveling, especially regarding your named beneficiaries. You may also wish to take another look at your other insurance policies, such as auto and homeowners, to check that they are up-to-date as well.
8. Review Titles and Beneficiaries
In addition to reviewing life insurance beneficiaries, make sure beneficiaries on other retirement, paid-on-death (POD), or transfer-on-death (TOD) accounts are also current. Check that all titles and deeds are correct as well.
9. Account Information
Before you travel, it is also the perfect time to gather information for all of your financial accounts, including banking, checking, credit card, investment, etc., and put it together in one file. Be sure to tell your loved ones where to find this information should they need to do so.
10. Digital Assets
These days it's no longer enough to plan for the distribution of your physical assets after your death—you also should be thinking about your online life and digital legacy as well. While you may already have made provisions for bank or credit accounts, consider your email and social media accounts, as well as any websites you own or operate. Plan for who you would like to have access to your digital assets and make sure your wishes—as well as logins and passwords—are recorded in a safe place.
The next time you're making travel plans, take a look at this checklist and spend some time to get all of your estate planning documents in order. That way you can leave for your trip with the peace of mind that you've done all you can to have your estate in the best shape possible for both you and your loved ones.