📅 Updated: July 2026 · Written by Tom · 12 min read

Estate Planning 101: What You Actually Need (and What You Don't)

Estate planning sounds like something for rich people with trusts and yachts. It's not. It's for anyone who owns something (a bank account, a car, a house) and has opinions about who should get it when they die. If you die without a will, the state decides who gets your stuff — and the state doesn't care about your wishes. I learned this the hard way when my dad died without a will and it took 18 months and $5,000 in legal fees to sort out his estate.

Here's what you actually need, what you don't, and how to get it done without spending a fortune.

📖 Contents
  1. The will: the bare minimum
  2. Beneficiary designations: the thing people forget
  3. Power of attorney and healthcare directive
  4. Trusts: do you need one?
  5. If you have kids
  6. How much does this cost?

The will: the bare minimum

A will is a legal document that says who gets your stuff when you die and who's in charge of distributing it (the executor). Without a will, your state's intestacy laws decide — and they don't care if you wanted your sister to get the house or your best friend to get the car. The state follows a formula: spouse gets X%, kids get Y%, parents get Z%.

Who needs a will: anyone over 18 who owns anything. If you have a bank account, a car, or a lease, you need a will. If you have kids, you definitely need a will (more on that below).

What a will covers: real estate, bank accounts, personal property (cars, furniture, jewelry), and digital assets (social media, online accounts). It does not cover assets with beneficiary designations (401k, IRA, life insurance) — those go directly to the named beneficiary regardless of what the will says.

How to get one: you can use a service like LegalZoom ($99–149), Trust & Will ($159–199), or hire an estate attorney ($300–800). For a simple will (you're under 50, no complex assets, no blended family), an online service is fine. If you have a blended family, a business, or assets over $1 million, hire an attorney.

Beneficiary designations: the thing people forget

Retirement accounts (401k, IRA), life insurance policies, and some bank accounts have beneficiary designations. When you die, those assets go directly to the named beneficiary — they don't go through probate and they're not controlled by your will. This is good (it's fast and avoids probate), but it means you need to keep your beneficiary designations up to date.

Common mistakes:

Log into your 401k, IRA, and life insurance accounts right now and check the beneficiaries. It takes 5 minutes and it's the most important thing you'll do today.

Power of attorney and healthcare directive

A will only matters when you die. A power of attorney (POA) and healthcare directive matter when you're alive but incapacitated (in a coma, severe illness, accident).

Power of attorney: this designates someone to make financial decisions for you if you can't. If you're in a coma and your spouse needs to pay the mortgage, access your bank accounts, or sell your car, they need a POA. Without one, they have to go to court to get conservatorship — which costs $3,000–5,000 and takes months.

Healthcare directive (living will): this says what medical treatments you want (or don't want) if you can't communicate. Do you want to be on life support? Do you want to be an organ donor? This document tells your family and doctors what you want so they don't have to guess.

How to get them: most online will services (LegalZoom, Trust & Will) include POA and healthcare directive for the same price ($99–199). You can also get free forms from your state bar association.

Trusts: do you need one?

A trust is a legal entity that holds your assets and distributes them according to your instructions. Trusts avoid probate (which can be slow and expensive), provide privacy (wills are public, trusts are not), and can control how and when beneficiaries receive money (e.g., "my kids get the money at age 25, not 18").

Who needs a trust:

Who doesn't need a trust: most people under 50 with simple assets (a house, a 401k, a bank account). A will is fine. If you're not sure, consult an estate attorney — most offer a free or low-cost consultation ($100–200).

If you have kids

If you have minor children, your will should name a guardian — the person who will raise your kids if you and your spouse both die. Without a named guardian, the court decides — and they may not pick who you would have chosen. This is the most important part of a will for parents.

You should also set up a trust for the kids (or name a trust as the beneficiary of your life insurance and retirement accounts). This ensures the money is managed by a responsible adult until the kids reach a certain age (25, 30, whatever you choose). Without a trust, the court manages the money until the kids turn 18 — which is usually not what you want.

How much does this cost?

For most people, an online will service is fine. If you have complex assets, a blended family, or a special needs child, hire an attorney. The cost is worth it to avoid probate and family disputes.

Estate planning is not just for the rich. It's for anyone who wants to control what happens to their stuff and their kids when they die. A will, beneficiary designations, and a power of attorney are the bare minimum — and they cost less than $200. Do it today, then forget about it until the next major life event (marriage, divorce, birth, death).

My dad died without a will and it took 18 months and $5,000 to sort out. This site is one person writing about money — not a firm, just what actually worked.