Estate Planning Checklist: The 5 Documents Every Young Family Needs

Jun 15

By Novak Financial Partners · Updated April 2026

Key takeaways

Every family with minor children needs five documents: a will, revocable living trust, durable power of attorney, healthcare proxy, and updated beneficiary designations
Without a will naming a guardian, a court decides who raises your children
A trust without funding is worthless. Assets must be retitled into the trust for it to work
Beneficiary designations override your will entirely on retirement accounts, life insurance, and financial accounts
Add a HIPAA authorization alongside your healthcare proxy so family members can legally access your medical information
We recommend Trust & Will as an accessible starting point for most young families

Estate planning is the financial task most young families put off the longest. The kids are healthy. Life is busy. It feels like something to handle someday.

But estate planning is not about dying. It is about what happens to your children if you do. Who raises them. Who manages the money. Who makes medical decisions if you are incapacitated but still alive. Without documents in place, courts answer those questions using default rules that may have nothing to do with your wishes.

Here are the five documents every young family needs, two additional steps worth knowing about, and the two mistakes that undermine even well-intentioned plans.

The 5-document checklist

Last will and testament

A will directs how your assets are distributed after you die and, most importantly for young parents, names a guardian for your minor children. This is the only document that can designate a guardian. A trust cannot do this.

If you have a trust, your will should be structured as a pour-over will. This means any assets not already in the trust at your death automatically flow into it, ensuring nothing falls through the cracks.

Without it: A court applies your state's intestacy laws to decide who inherits your assets. More critically, a court decides who raises your children, and that process can be contested, delayed, and deeply painful for everyone involved.

Revocable living trust

For families with minor children, a revocable living trust is the foundation of a complete estate plan. It avoids probate, the often slow and public court process through which a will must pass. Assets held in the trust transfer directly to your beneficiaries without court involvement.

A trust also lets you control how and when your children receive assets. Rather than an eighteen-year-old inheriting a large sum outright, the trust can specify distributions at ages you choose, for purposes you define, managed by a trustee you name.

During your lifetime, you remain the trustee. You retain full control of everything in the trust and can change it at any time.

We recommend Trust & Will as an accessible starting point for most young families. Their platform makes creating a trust straightforward and significantly less expensive than traditional attorney-only estate planning.

Durable power of attorney

A durable power of attorney gives a trusted person the legal authority to manage your financial affairs if you become incapacitated. Without one, even your spouse may lack the authority to access accounts, pay the mortgage, or file taxes without going to court first.

The word durable means the power stays in effect if you become incapacitated, which is exactly when you need it. A non-durable POA would terminate at incapacity, defeating the entire purpose.

Without it: A court must appoint a guardian to manage your finances. The process is slow, expensive, and public. It creates enormous stress at a moment your family is already dealing with a health crisis.

Healthcare proxy and advance directive

A healthcare proxy designates someone to make medical decisions on your behalf if you cannot make them yourself. An advance directive specifies your wishes about end-of-life care, life support, and organ donation.

These documents protect your family from having to make agonizing decisions without guidance. They also prevent family disagreements that can escalate into legal disputes.

Pair these with a HIPAA authorization. HIPAA privacy rules can prevent healthcare providers from sharing your medical information with family members, including your spouse, without explicit written permission. A HIPAA authorization gives designated individuals the legal right to access your medical records and discuss your care with providers. It is a simple document that is often overlooked and should accompany every healthcare proxy.

Without it: Medical decisions default to next of kin following a legal hierarchy that may not reflect your wishes or your relationships. For unmarried couples, this is especially critical.

Beneficiary designations

Beneficiary designations on retirement accounts, life insurance policies, and financial accounts are not a document you create once. They are instructions you update throughout your life, and they override everything else.

Your will does not govern these assets. Your trust does not govern these assets. Whoever is named on the form gets the money, full stop. Review every account after marriage, divorce, the birth of a child, and the death of a named beneficiary.

Common mistake: A 401(k) opened at age 23 still naming a parent as beneficiary. A life insurance policy purchased before marriage still listing an ex. These designations are legally binding regardless of what any other document says.

Two additional steps worth taking

Life insurance. A will and trust direct where your assets go. Life insurance creates assets to direct in the first place. For families with young children and a working parent, life insurance is what replaces income if that parent dies. Term life insurance is straightforward and affordable for most young families. The general rule of thumb is coverage equal to 10 to 12 times your annual income, though your specific situation may warrant more or less. This is a financial planning conversation, not a legal one, but it belongs on the same checklist.

Store documents and tell someone where they are. Estate planning documents do your family no good if no one can find them. Keep originals somewhere secure and accessible. Tell your executor, spouse, or a trusted family member where they are stored. A digital copy in a secure location is also a good backup. The most complete estate plan in the world fails if it sits in a drawer no one opens.

The two mistakes that undermine even good estate plans

Most families who do estate planning do the right thing by getting it done. But two mistakes are common enough, and costly enough, to deserve their own section.

Mistake 1: Creating a trust but never funding it

This is the single most common estate planning mistake, and it is also the most avoidable. A trust is a legal container. Creating it is only half the job. The other half is funding it, which means retitling your assets into the name of the trust.

If your bank accounts, investment accounts, and real estate are never transferred into the trust, they still go through probate when you die. The trust document exists, but it has no legal power over assets that are not in it.

How to fund a trust: Contact each financial institution and request that account ownership be changed to your trust. For a trust named "The Smith Family Trust," accounts are retitled to "Jane Smith and John Smith, Trustees of The Smith Family Trust." Real estate requires a new deed.

Note: retirement accounts like 401(k)s and IRAs should not be retitled into a trust directly. Name the trust as a beneficiary on those accounts instead, after reviewing the tax implications with a financial planner.

Mistake 2: Having a will but no beneficiary deed on the house

For families who have a will but not a trust, the home is the most common asset that falls into this gap. A will does not keep your house out of probate. It just tells the court who should receive it after the court process is complete.

A beneficiary deed, also called a transfer-on-death deed, solves this. It is recorded with your county, names who inherits the property at your death, and takes effect immediately at death without probate. While you are alive, the beneficiary has zero rights to the property. You can sell it, refinance it, or change the beneficiary deed at any time.

The practical rule: If you have a trust, deed the house into the trust. If you have a will but no trust, record a beneficiary deed on your home. Either way, your primary asset should not have to go through probate to reach your family.

When to review your estate plan

Estate planning is not a one-time task. Review everything after any of these events:

→ Marriage or divorce
→ Birth or adoption of a child
→ Death of a named beneficiary, guardian, trustee, or executor
→ Significant change in assets, including RSU vesting, inheritance, or home purchase
→ Move to a new state, since estate planning laws vary significantly
→ Every three to five years regardless of whether anything has changed

Frequently asked questions

Do young families need a trust or just a will?

For families with minor children, a revocable living trust is generally the better foundation. It avoids probate, controls how and when assets reach your children, and names a trustee to manage those assets until your children are adults. A will is still needed alongside the trust to designate a guardian and catch any assets not transferred into the trust.

What happens if you have a trust but never fund it?

Assets that are never retitled into the trust still go through probate when you die, exactly what the trust was designed to prevent. The trust document exists but has no legal power over assets outside of it. Funding means changing the ownership of accounts, investments, and real estate to the name of the trust.

Do beneficiary designations override a will?

Yes, completely. Retirement accounts, life insurance, and financial accounts with named beneficiaries pass directly to those beneficiaries regardless of what your will says. Review every account after every major life event. An outdated beneficiary designation is one of the most common ways well-intentioned estate plans go wrong.

What is a HIPAA authorization and do I need one?

A HIPAA authorization gives designated individuals the legal right to access your private medical information. Without one, healthcare providers cannot legally share your medical details with family members, including your spouse, even in an emergency. It is a simple but often overlooked document that should accompany your healthcare proxy.

What is a beneficiary deed and do I need one?

A beneficiary deed, or transfer-on-death deed, lets you name who inherits your home at death without going through probate. If you have a trust, deed the home into the trust. If you have a will but no trust, record a beneficiary deed. Either way, your home should not have to go through a court process to reach your family.

Who should I name as guardian for my children?

Choose someone whose values, parenting style, and genuine capacity to take on the responsibility align with your own. Have a direct conversation with them before naming them. Name an alternate in case your first choice cannot serve. Without this designation in your will, a court decides who raises your children.

How does estate planning connect to my financial accounts?

Closely. Your 401(k), IRA, life insurance policy, and brokerage accounts all have beneficiary designations that operate completely independently of your will or trust. RSU vesting events, new life insurance policies, and account rollovers all create new accounts that need designated beneficiaries. Estate planning and financial planning need to be coordinated, not treated as separate tasks.

Where should I start?

We recommend Trust & Will as an accessible, affordable starting point for most young families. Their platform guides you through creating a trust, will, power of attorney, and healthcare directive in one place. For families with more complex situations, multiple properties, or significant assets, working directly with an estate planning attorney is worth the additional cost. Either way, an imperfect plan that exists is far better than a perfect plan you have not gotten around to yet.

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This article is for educational and informational purposes only and does not constitute personalized legal, tax, or financial planning advice. Estate planning laws vary by state and are subject to change. The information provided is general in nature and may not apply to your specific situation. References to Trust & Will are for informational purposes only and do not constitute an endorsement or recommendation. Consult a qualified estate planning attorney before creating or amending any legal documents. Advisory services are offered through Core Planning LLC, a Registered Investment Advisor. For additional disclosures please visit corepln.com/disclosures.

Max Novak