Serving as an executor or personal representative of someone’s estate can often be a difficult and stressful undertaking. Trying to sort through a loved one's documents, assets, and intentions while mourning their death can be overwhelming.
If something were to happen to you today, would your loved ones know what to do? Would they know who to contact? Would they know how to track down your assets? Could they recognize a legitimate creditor? A "letter of instruction" can ease some of the stress and effort involved in the estate administration process.
A letter of instruction is an informal letter to an executor, personal representative, and/or other family members that provides important information about your assets and final wishes after death. This letter provides supplemental information not included in a will, revocable trust, or other estate planning documents. Although this letter is not legally binding, it can make administering an estate much easier and more efficient for grieving family members.
This letter can also be changed over time as personal information and circumstances change without the need to contact an attorney. A letter of instruction should not contradict any information in estate planning documents, however, it can include additional details about the directions included in an estate plan.
A letter of instruction should include the following:
- Funeral arrangements: Describe your desired burial arrangements, such as the type of funeral and burial you prefer, if you have a preferred funeral home, clergy member, songs, speakers, or tribute photos. Provide information and the location of documentation for any prearranged or prepaid funeral or burial details. You may also wish to include information that you would like to be included in your obituary, such as a list of loved ones, education, work history, and any other information you want to be sure is included.
- Important documents: Include the location of your important documents, such as estate planning documents, recent statements of your financial accounts, deeds, titles and mortgage documentation for your real property, birth, marriage, or divorce papers, and your Social Security card. You may also want to include the location of recent tax returns because tax returns can provide a lot of information about your assets and personal information. If such documents are located in a safe, provide the access information as well.
- Financial representatives' contact information: Provide a list of names and contact information for your financial advisors, tax preparers, attorneys, insurance agents, real estate agents, and bankers. Your trusted advisors can assist with asset location and transfer, filing final tax returns, and providing anecdotal background information.
- Asset information: Catalog all of your assets, identifying information, location, titling, and current value of each item. Do not forget to include all real property, time shares, bank, brokerage and retirement accounts, business interests, stock certificates, savings bonds, annuities, life insurance, safe deposit boxes, and valuable or sentimental personal property.
- Online accounts and computer files: There have been many changes in recent years to laws regarding the administration of email accounts, social media accounts, and music and photo libraries. You may want to create a list of your files and accounts and name a successor in your estate planning documents to handle them. Proper documentation of succession planning is necessary because state and federal laws may prohibit others from accessing or using your files and accounts without written consent.
- Debt information: Include information about any debt you carry, such as the contact information for the lenders, account numbers, statements, and balances.
- Beneficiary information: List all of the beneficiaries included in your estate plan, and include their contact information. This will help your executor identify and locate persons receiving your assets.
- Pets: If your estate plan does not include instructions for caring for your pets after you are gone, you can include that in the letter of instruction. Indicate your preferences for the person you would like to care for your pets, and any special instructions about their care. You should also include the contact information for your veterinarian.
- Personal property distribution list: Many states legally allow you to create a document separate from your will that lists specific items of tangible personal property you would like to leave to specific people. This list often must reference your will and be referred to in your will. However, even if your state of residence does not permit a separate document regarding the distribution of personal property items, you may want to include your wishes for distribution of tangible personal property you want to go to specific people in your letter of instruction. Keep in mind that this is not legally binding (if not allowed by statute in your state of residence), but it could help provide your executor with some direction to carry out your wishes and help avoid disputes over who should receive items that may have special meaning to certain family members or friends.
- Personal messages and explanation of your intentions: You may wish to include sentimental messages to family members, and/or more details about your values and feelings about money. For example, if you excluded a family member from inheritance, or if you have strong feelings about how assets are spent for a beneficiary's education, you can explain it in the letter. You might also consider including such personal messages or explanation of your intentions in a video. Although the personal messages and explanation of your intentions are not legally binding, these details can help prevent family squabbles, or help your loved ones be clear about your intentions.
A letter of instruction should not include the following:
Administering an estate is often a difficult and challenging process. A letter of instruction can greatly ease the stress and confusion of this process. Include a copy of the letter of instruction with your estate planning documents, give one to your attorney, and leave one in a place your family members might look first. Also, if you are comfortable, provide a copy to your executor and review it with them. It is important to update your letter, even as often as annually, because your assets and corresponding documentation change often.
For additional information on getting organized after the death of a loved-one, see our Inheritance Checklist
For additional information on executor and trustee duties, see our Executor & Trustee Guidelines