The pre-retirement estate planning checklist

The five years before retirement are when your estate plan either gets updated or quietly drifts out of date. Documents signed when your kids were small and your mortgage was recent may not match what you want now. Here's the checklist.

Review the core documents

Pull your will, trust, durable financial power of attorney, and healthcare directive. Read them front to back. Look specifically for: named people who have died, divorced, moved out of state, or otherwise shouldn't be in the role anymore; dollar amounts and percentages tied to old circumstances; guardianship provisions for children who are now in their thirties; trustee succession language that names people who are now older than you. If any of these apply, you're overdue for a full rewrite, not a codicil.

Update beneficiary designations with retirement in mind

Every retirement account (IRA, 401(k), 403(b), SEP, pension) has a beneficiary form. So does every life insurance policy. So do most bank accounts with payable-on-death registrations. As retirement nears, the distribution strategy starts to matter more than it did during accumulation.

Name contingent beneficiaries. A surprising number of retirement accounts list only a primary beneficiary. If your spouse predeceases you or you both pass simultaneously, the account without a contingent beneficiary goes through probate.

Consider the SECURE Act. For accounts inherited by a non-spouse after 2019, the ten-year distribution rule forces income tax acceleration that often makes the standard 'spouse then kids' beneficiary structure tax-inefficient. A see-through trust or different sequencing may save your heirs significant taxes.

Long-term care planning

Long-term care is the biggest wildcard in retirement planning. Industry data puts assisted living in Arizona at roughly $5,500 a month and a private nursing home room at over $9,000 a month, with double-digit annual inflation in recent years.

Three broad approaches. Self-insure if your assets can absorb a five-to-eight-year care event. Buy long-term care insurance while you're still insurable (typically before 60). Use a hybrid life/LTC policy or an annuity with LTC riders if you want some upside without the use-it-or-lose-it premium dynamic of traditional LTC policies.

Whichever approach you choose, document it in the plan. If you're self-insuring, the trust should specify how care expenses get paid and who approves them. If you're insured, the policy documents go in the binder with the estate plan.

Medicare, healthcare directives, and care coordination

Enroll in Medicare in the right window. Late enrollment can trigger permanent premium penalties (42 U.S.C. § 1395r(b)). Coordinate Medicare enrollment with any retirement date that affects employer coverage.

Update your healthcare power of attorney and living will. The documents you signed 15 years ago may have named people who are no longer the right agents. A.R.S. § 36-3221 governs Arizona healthcare POAs.

Discuss end-of-life preferences explicitly with the person you name. A document is only as useful as the conversation that went with it.

Tax-sensitive moves before RMDs

Required minimum distributions start at age 73 under current law (SECURE 2.0 Act). Once RMDs begin, taxable income jumps and tax planning options narrow. Before then, consider:

Roth conversions during low-income years. The years between retirement and age 73 often include the lowest-income years of your adult life. Converting part of a traditional IRA to a Roth IRA in those years pays tax at a lower rate.

Qualified charitable distributions. Once you turn 70½, you can direct up to $100,000 per year (indexed for inflation) from an IRA directly to charity, which satisfies the RMD without showing up as taxable income (IRC § 408(d)(8)).

Step-up in basis planning. Appreciated assets held at death receive a step-up in basis. Highly appreciated assets may be better held than sold during your lifetime.

Charitable planning

If charitable giving is part of your legacy, the structure matters. Outright gifts in the will, a charitable remainder trust, a charitable lead trust, and a donor-advised fund each have different tax and practical effects. For gifts over a threshold that often starts around $100,000, the structured options begin to make sense.

Simplify where you can

Over a lifetime, people accumulate accounts. A 401(k) from three jobs ago. A brokerage account at a firm whose name has changed twice. Two life insurance policies you can't quite remember why you bought. Consolidate where possible before retirement. It makes the plan simpler, reduces the chance a beneficiary designation gets missed, and makes your executor's job dramatically easier when the time comes.

Next steps

If you're within five years of retirement and haven't reviewed the estate plan in that time, schedule a free 30-minute consultation. We review current documents, identify what needs refreshing, and quote a flat fee for the update work. You'll know the number before you commit.