With retirement on the horizon, you may be wondering what steps you should be taking from an estate planning standpoint. At its core, there are three key estate planning considerations to keep in mind: cost, control and flexibility, and what you leave behind.

In this week’s Money Wisdom Question Series, Nicholas J. Colantuono, CFP® explains how a solid plan can help you manage all aspects of your estate and legacy.

Update Your Beneficiaries

Your first step is to review and update beneficiaries on all your retirement, bank, and brokerage accounts. For non-retirement accounts, you can work with your advisor to add “Transfer on Death” (TOD) designations, which function like beneficiary designations.

It’s also important to review any life insurance policies to ensure the right beneficiaries are named. For personal assets like real estate or collectibles, you can specify recipients in your will.

Understand the Role of a Will

Keep in mind that while a will outlines how you’d like your assets to be distributed, it doesn’t avoid probate. The probate court still oversees the process, even with a will in place. While a well-written will is essential and provides clarity, it can still be contested, which may delay or complicate the distribution of assets.

Consider Trust Planning

On the other hand, a trust helps you avoid probate and offers more control. A living trust, also known as a revocable trust, allows you to manage and access your assets during your lifetime. However, it doesn’t protect assets from creditors or long-term care costs, since it remains part of your estate. For additional protection and potential tax benefits, you may consider an irrevocable trust which removes assets from your estate in exchange for flexibility.

Build a Complete Plan

Beyond beneficiaries and wills, a comprehensive estate plan should include healthcare proxies, medical directives, and powers of attorney. These key estate planning tools help ensure that your financial and medical wishes are upheld if you become incapacitated. Trusts add an extra layer of control, letting you determine how and when your assets are distributed. If that is important to you, talk with your advisor or estate planning attorney about incorporating trusts into your plan.