Protecting your financial legacy and ensuring the monetary and physical assets you’ve amassed are properly transferred to the beneficiaries of your choosing is a cornerstone of estate planning.
An important first step in your estate plan is crafting a will to create a legally binding document that clearly defines your desires for your estate upon your death. Another key element of your estate plan is writing a letter of instruction to your heirs. This document provides a working roadmap for the people who will be settling the affairs of your estate and inheriting your assets. Think of this document as a supplement to your formal will to ensure your final wishes are clearly explained so they can be properly carried out.
A letter of instruction (sometimes called a letter of intent) is an informal document and is not a legally binding instrument. However, it is important since it leaves behind instructions, arrangements, and other key information that typically is not part of your formal will. It’s also written in plain English rather than complicated legalese, so it’s easily understood by all affected parties.
Think of it as a letter of instruction, a means of final housekeeping, for the executor of your will and your heirs when you pass. You can say what you want, and you can say it any way you want.
A letter of instruction can be invaluable if you have a lot of assets spread out across different states or in different places. Say, for instance, you have a small hunting cabin at your favorite lake. The cabin is part of your estate and likely has a designated heir in your will. But if you want your gun collection, camping equipment, and off-road vehicle that are stored there to go to someone else, you could include that information in your letter of intent.
Other information that’s an essential aspect of a letter of intent includes:
Since this document isn’t legally binding, you have the flexibility to include anything else you want in your letter of instruction. The goal is to incorporate as much helpful information as possible since you don’t have a say in matters once you have passed.
When writing your letter of instruction, include as much information about your estate and your assets as possible, and provide detailed instruction for how you want any assets not mentioned in your formal will to be dispersed among your heirs.
Your letter of intent doesn’t supersede the terms of your will. It can, however, go a long way toward alleviating familial infighting for some of your possessions, especially items that hold sentimental or monetary value. Once you have completed this document, sign and date it and keep a copy with other important papers or give a copy to the executor of your estate.