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Understanding estate planning: The basics

Learn the fundamentals of estate planning and how it can benefit your legacy and loved ones.

What is estate planning?

An estate plan is vital to leaving the legacy you want. It allows you to provide for the people, organizations or causes you care about after you’re gone — while also providing peace of mind for yourself and your loved ones now.

Yet, it may seem intimidating to those just starting to think about estate planning.

It doesn’t have to be. An Ameriprise financial advisor, along with your estate attorney and tax professional, will help you create an estate planning strategy that reflects your financial priorities and  values.

Here is an introduction to the fundamentals of estate planning — and how it can benefit you.

In this article:

What is an estate plan?

Estate planning is the process of mapping out how your property and assets will be distributed in the event of your death. An effective estate plan typically addresses who will inherit your assets and often includes a detailed plan for end-of-life health care decisions, should you become incapable of making these decisions yourself. It also seeks to minimize the tax burden for those who inherit your assets.

Benefits of estate planning
A thoughtful estate plan goes beyond deciding who gets what. Here are some of the most important estate planning benefits:

  • Clarity: An estate plan creates clear directions for distributing your property and assets upon your death — exactly as you wish — and allows you to name people to oversee that process, such as an executor or trustee. If you have minor children or other dependents, an estate plan allows you to name a guardian in the event of your passing.
  • Medical guidance: If you’re not able to make decisions for yourself, an estate plan can outline your health care wishes and name someone to make financial and medical decisions on your behalf.
  • Flexibility: An estate plan gives you options to support the people, charitable organizations and causes you care about most during your lifetime and after you’re gone.
  • Saves money and time — and ensures privacy: Without an estate plan, a court in your state of residence will determine how to distribute your assets after you die. This public, court-supervised process is known as probate. It is a time-consuming process that often results in higher costs and taxes for your heirs and loved ones. An estate plan can also provide tax mitigation benefits to help pass on as much of your estate as possible.
  • Peace of mind: An estate plan gives your loved ones a clear understanding of your precise wishes during a difficult time.

Learn more: Getting started on estate planning: Key actions to take

Fundamentals of an estate plan

Most estate plans include several basic elements, though yours may include more advanced tools and strategies depending on your family situation as well as the size and complexity of your estate.

Here are the most critical elements of an estate plan:

  • Designated beneficiaries
  • Durable power of attorney
  • Health care directive
  • Health care proxy
  • Last will and testament
  • Trusts
  • Charitable giving designations

Creating an estate planning team

Estate planning is usually a team effort involving you, your family, your financial advisor and other professionals. Here are the key figures involved:

  • Financial advisor
  • Estate attorney
  • Tax advisor
  • Durable power of attorney
  • Medical power of attorney
  • Executor
  • Trustee

Learn more: How to choose an estate planning team: Attorneys, trustees and executors

How often should I update my estate plan?

Like your financial plan, it's important to review your will and other estate planning documents regularly — or when significant life events occur, at the minimum. While there isn’t a one-size-fits-all approach, review your estate plan after major life events or every 3 to 5 years.

Significant life events may include:  

The best time to start planning is now

An Ameriprise financial advisor will work with you and your estate planning team to guide you through the process, evaluate your specific needs and create a strategy that makes sense for you, your loved ones and your values. 

How can I define my estate planning goals and objectives? Which financial accounts should I review for beneficiaries? Do you have any referrals for tax attorneys or lawyers who can help with my estate plan?

When you’re ready to reach out to an Ameriprise financial advisor for a complimentary initial consultation, consider bringing these questions to your meeting.

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An advisor can help you create a financial strategy that includes estate planning based on your goals and priorities.

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At Ameriprise, the financial advice we give each of our clients is personalized, based on your goals and no one else's. 

If you know someone who could benefit from a conversation, please refer me.

Background and qualification information is available at FINRA's BrokerCheck website.

Ameriprise Financial, Inc. and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.


The initial consultation provides an overview of financial planning concepts.  You will not receive written analysis and/or recommendations.


Investment products are not insured by the FDIC, NCUA or any federal agency, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value.


Investment advisory products and services are made available through Ameriprise Financial Services, LLC, a registered investment adviser.  


Securities offered by Ameriprise Financial Services, LLC. Member FINRA and SIPC.

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