Wealth Planning Insights
What Estate Planning Documents Do I Need?
Michael Pumphrey, MS, CFP®, AFC®, EA, August 2025
Estate planning is often pushed to the bottom of the to-do list. If you are in your thirties or even twenties, focusing on your career or starting a family is often your primary focus. The idea of building and passing along a legacy sounds like an abstract, far-off idea.
Regardless of where you are in life, there are steps you can take today that will protect you and your loved ones.
As a financial advisor and a former teacher, I work with a wide range of clients, many of them younger professionals. One of the most common misunderstandings I see is the belief that estate planning is only for people with significant wealth or those nearing retirement. But the fact of the matter is, if you're an adult, you need some essential documents.
It’s important to note that financial advisors do not draft these documents ourselves. That is the estate attorney’s job. Our job is to educate and help you start thinking about the decisions that need to be made. We take all the time needed to collaborate to make sure your estate planning strategy accurately reflects your family relationships, what you value most, and what you wish to leave behind.
Start with the Basics
In an ideal world, virtually everyone over 18 should have a last will and testament.
This is the foundation of most estate plans. A will is a legal document that lays out your instructions for what should happen to your assets when you die. It names the people or organizations you want to receive your property and appoints someone to carry out your wishes.
Your will can name guardians for your minor children, outline how debts and taxes should be handled, and even leave specific instructions for sentimental items or charitable gifts. But it doesn’t govern everything you own. Certain types of accounts and assets, like retirement plans, life insurance policies, or jointly owned property, pass automatically to the people listed as beneficiaries or co-owners, regardless of what your will says. That’s why it’s so important to make sure your beneficiary designations match your intentions and are kept up to date.
Without a will, the state decides who gets what according to its default rules. Writing a clear, legally valid will gives your loved ones a roadmap.
In addition, your estate plan should include the following documents:
Advance Directive or Living Will. This outlines your preferences for medical treatment if you’re in a terminal or irreversible condition and can’t communicate your wishes. It tells your healthcare providers and loved ones whether you would want life-sustaining treatment to continue or be withdrawn, and whether you want comfort care instead. This document supports your medical power of attorney by removing guesswork from deeply personal decisions.
Medical Power of Attorney. This appoints someone to make healthcare decisions for you when you’re unable to make them yourself. That includes choosing between treatment options, approving surgeries, or making end-of-life care decisions with your medical team. Like financial powers of attorney, you can name co-agents or successors if your first choice is unavailable. This is one of the most important documents for young adults. Parents are often surprised to learn they can’t legally make medical decisions for their college-aged children without one.
Durable Financial Power of Attorney. This document lets you appoint an agent to manage your financial affairs if you can’t. That could mean paying bills, handling taxes, managing investment accounts, or buying or selling property on your behalf. You can name more than one person to serve together or separately. Some documents are written to take effect immediately, while others become active only if you’re declared incapacitated. You can also limit what your agent is allowed to do or give them wide authority, depending on your situation and level of trust.
HIPAA Authorization. This gives the people you name the ability to access your private medical information and communicate with your doctors. Unlike the medical power of attorney, which gives decision-making authority, this is about sharing information. You can choose what types of information to release and who can receive it. It's helpful if you want a family member or friend to be informed but not necessarily in charge of your care.
Guardianship Designation. If you have minor children or dependents with special needs, this document lets you name who should care for them if something happens to you and your co-parent. You can also specify how those children will be financially supported, whether through a trust, a designated account, or other resources. Without this document, the courts will decide who steps in, which may not align with your wishes.
Without these important “living documents”, your loved ones could run into legal and logistical roadblocks during the kind of medical emergencies that can happen at any age.
If you don’t have these documents at hand, don’t panic. I or another advisor on the Tanglewood team would be happy to talk you through what to consider. And don’t worry if you don’t yet own a lot of property or have a fairly straightforward financial life. Anyone will benefit from having a plan set ahead of time.
Even those who have these documents still need to keep them up to date. When I talk to new clients who have already created estate documents, they are often years or decades old. Estate planning isn't a one-and-done activity. Life changes. Families grow. You might get married, have kids, change jobs, or accumulate new types of assets. Each of these moments is a good opportunity to check in on your estate plan.
The Best Time To Start Is Today
I try to encourage my clients to think of estate planning as a conversation that remains open and that we can return to at any time. You are making your wishes known and easing the burden on your loved ones. You may not think you have much to sort out right now, but your family still needs direction. Your estate plan is as much for them as it is for you.
Estate planning is a living process that changes with your life. If you have questions about how to get started, my door is always open.