Where Should I Keep My Estate Planning Documents—and Who Should Know Where They Are?

Dear Mr. Miller:

My husband and I recently completed our estate planning. We now have a Living Trust, Wills, Powers of Attorney and other documents. Our attorney gave us the original documents as well as digital copies.

Now we have a very basic question: What are we supposed to do with all of this?  Should the originals go in a safe-deposit box? Should we keep them at home? And should we give copies to our children now, or just tell them where everything is?

Trying to Be Organized

Protect the Originals—but Don’t Hide Them
Someone Needs to Know
Keep Digital Copies Too
Should I Give My Children Copies Now?
Don’t Forget About Incapacity
Your Family Needs More Than the Trust
The Simple Rule

Dear Trying:

This sounds like a simple question. It isn’t.

You can spend considerable time and money creating an excellent estate plan and still leave your family with a serious problem if, when the documents are needed, nobody can find them.  In fact, several years ago I wrote about a daughter whose father had died owning a million-dollar home in his Living Trust. She was ready to sell the house, but escrow asked for a copy of the Trust—and she couldn’t find it. Suddenly, a relatively straightforward Trust administration had become a major problem.

The lesson is simple: Creating the estate plan is only part of the job. Someone also has to be able to find it.

Protect the Originals—but Don’t Hide Them: Your signed original estate planning documents should be kept somewhere secure and protected from fire, water damage, theft and accidental destruction.  A safe-deposit box is one possibility. A good fire-resistant home safe or another secure, fire-resistant location may also work.

There is no single location that is right for everyone.  What matters is that the documents are protected and that the right person knows exactly where they are.

I currently send my clients their ink-original estate planning documents shortly after everything has been signed. I generally recommend that those originals be kept in a safe-deposit box or another fire-resistant facility.

But putting documents someplace safe is only half the answer.  If no one knows where you put them, you have simply created a very secure hiding place.  In fact, when I meet with clients for their periodic estate planning reviews, I routinely ask where they are keeping their original documents. If they say, “in the safe at home,” I usually have one more question:  Where is the safe?  The same applies to a fire-resistant filing cabinet or other storage location. Your Successor Trustee should not have to search every closet, bedroom, garage cabinet and storage area in the house trying to find it.

Someone Needs to Know: At least one trusted person should know that your estate planning documents exist and where the originals are stored.  That person might be your spouse, an adult child, your Successor Trustee, your agent under your Power of Attorney, or another person you trust.  They do not necessarily need to have possession of your original documents today.  But they should know enough that, when the documents are needed, they can actually locate them.

If the originals are in a safe-deposit box, someone should know where the box is located and how access can be obtained when necessary.  If they are in a home safe, someone should know where that safe is located and how the appropriate person will gain access.  If they are in a fire-resistant filing cabinet, someone should know which cabinet and where it is kept.  The goal is not to make your private documents available to everyone. The goal is to make sure they are available to the right person at the right time.

Keep Digital Copies Too: Digital copies provide an additional layer of protection.  Along with returning the ink originals, I now send my clients digital copies of their completed estate planning documents. I suggest that those copies be stored on a computer or a clearly labeled flash drive so that they can be printed when needed.

But there is an important catch.  If the computer, flash drive, external drive or digital file is password protected, the person you are relying on must either have the password or know how to obtain it.

It is not enough to tell your daughter, “The Trust is on my computer,” if the computer is locked and nobody knows the password.  And it is not enough to put everything on an encrypted flash drive if no one else knows the password needed to open it.  That is one of the reasons I specifically tell clients that, if the documents are stored on a computer, their loved ones need to know how to gain access. If the copies are on a flash drive, the drive should be labeled and someone should know where it is kept.  A digital copy that nobody can unlock is not much of a backup.

Should I Give My Children Copies Now?: Usually, that is a different question.  Making sure someone knows where your estate planning documents are located does not mean you have to distribute copies of your entire estate plan to your children or beneficiaries while you are alive.  Some people are perfectly comfortable doing that.  Others would rather keep the details of their estate plan private.  Remember, your estate plan may change. Beneficiaries, Trustees and distributions can all be revised during your lifetime.  And your children probably have enough of their own paper and documents that they don’t need to keep track of someone else’s.

For many people, the better approach is simply to make sure one or two appropriate people know:
where the originals are located;
where the digital copies can be found;
how to access those digital copies if a password is required; and
whom they should contact if you become incapacitated or die.

You can then decide separately whether anyone should receive an actual copy during your lifetime.

Don’t Forget About Incapacity: People sometimes think this is only an issue after death.  It isn’t.

Your Power of Attorney, Advance Health Care Directive and provisions of your Living Trust may become important if you are alive but unable to handle your own affairs.  If you suffer a stroke, serious accident or cognitive decline, the people you selected to help you may need those documents quickly.  That is not the time for your daughter to say, “Dad told me he had everything taken care of, but I have no idea where he put it.”

Your Family Needs More Than the Trust: Even finding the estate planning documents may not be enough.  Your family may also need to determine where your bank and investment accounts are located, what insurance you have, what retirement benefits exist, what real estate you own, and whom you use as your attorney, accountant and financial advisor.  And, of course, it is equally important to make sure those assets have actually been coordinated with your Living Trust.  That is why I also provide my clients with an asset locator chart as part of their completed estate planning materials.  A good estate plan should not force your family to reconstruct your entire financial life from old mail, tax returns and bank statements.

The Simple Rule: Keep your original estate planning documents someplace secure enough that they will survive—but not so secret that no one can find them.  Keep a digital copy as a backup.  Make sure at least one trusted person knows exactly where the originals are located, where the digital copies are stored, and how to get into them if a password is required. 

And every so often, check again.  That is one reason I ask clients during periodic estate planning reviews where they are keeping their originals. Circumstances change. People move. Safes get relocated. Computers get replaced. Passwords change.

Years ago, I wrote about the daughter who couldn’t find her father’s Trust after he died.  The better time to solve that problem is before your children ever have to ask the question.

If you’re not sure whether your estate plan still does what you want it to do, give us a call at 760-436-8832.  A periodic estate planning review can help make sure your documents, assets, and current wishes are all working together.