A letter of last instruction can provide clarity to loved ones.

Creating an estate plan is the most important step you can take to protect your loved ones when you die.

If you have done this, your estate will be settled and assets distributed through legally recognized means.

Although you have your estate plan in place, it may still trigger frustration if you are unorganized.

According to a recent Qrius article titled “How to Prepare a Letter of Last Instruction,” writing a letter of last instruction provides a helpful roadmap to your loved ones after you have died.

You can use a letter of last instruction to provide additional guidance to your executor and loved ones.

Because a letter of instruction is not a legal document, many people leave this step out of their estate planning.

In reality, a document need not be submitted to courts to be beneficial.

A letter of last instruction can clarify your wishes, outline the steps your loved ones need to take, and provide direction for what arrangements should be made after you have died.

Because the loss of a loved one is both stressful and emotional, a letter of last instruction lightens the logistical burdens.

What should you include in your letter of last instruction?

Personal info.

Record your full name, birthdate, the names of your parents, your address, your place of birth, and your Social Security number.

Doing so will provide ready access to your loved ones or agents who will need to fill out forms after you are gone.

You also should also include information about people you would like to be notified of your passing.

Business and Financial Contacts.

You will want to list those with whom you work (or worked, if retired) as well as your investment adviser and your accountant.

If you have insurance policies, include these details.

Finally, you should add information for your bank accounts.

Legal Document Locations.

Your estate plan will be ineffective if no one can find it.

For starters, share the location of your last will and testament, tax returns, trust documents, Social Security card, birth certificate, marriage license, and deeds in your letter of last instruction.

If you are a veteran, your veterans benefits information should also be stored in the same place (think DD214).

Your executor and trustee will need these documents to settle your estate.

Loan and Debt Info.

Few people like to think about their debts.

By taking the time now to record your creditors, payment terms, credit card account numbers, and loan account numbers, you will help your executor notify and pay the appropriate individuals.

If you loaned money to others, make a list of these individuals.

Include how to contact them as well as their collateral and payment terms.

Usernames and Passwords.

Whether it be banking, email, or social media, you likely have a digital footprint.

Your executor, will need to ensure these "assets" are not compromised after your death.

Providing passwords and usernames to your agent or executor will allow them to take the appropriate steps to secure your accounts and electronics.

Be sure to update your general durable power of attorney, last will and testament, and revocable living trust to authorize your agent, executor, and trust to have access to your digital assets.

Beneficiaries.

List your beneficiaries as well as their contact information to streamline the distribution of assets.

If you have included specific instructions for the distribution of your estate in your legal documents, you can provide additional information or clarification in your letter of last instruction.

Funeral Arrangements.

Funeral arrangements should not be included in your last will and testament.

By the time this document is filed with the probate court, you will likely already be buried or cremated!

Your letter of last instruction is a better place to outline your funeral wishes.

You can add details about your burial clothing, the order of service, the location, the music, the flowers, and pictures.

By doing so, you can preempt arguments among loved ones regarding how to best remember you.

After creating your letter of last instruction, let your executor or a close family member know its location.

Should anything change, update your letter accordingly.

Reference: Qrius (Dec. 8, 2020) “How to Prepare a Letter of Last Instruction”