Every state has laws that decide what happens to a person’s money, medical care and children when that person hasn’t written down their own wishes. Three basic documents let clients make those decisions themselves. Advisors are well placed to ask whether those documents exist, and that one question can deepen a client relationship.
Key takeaways
- A durable power of attorney, a health care directive and a last will and testament are the three foundational documents for almost every client.
- Without them, state law and the courts decide who manages assets, who makes medical decisions and who raises minor children.
- Advisors don’t draft or interpret these documents, but asking whether they exist and are current is a valuable service and often leads to broader planning.
If your clients don’t take the time to plan correctly, state law is poised to do it for them, and rarely the way they would have chosen.
Why advisors should raise the topic
In the most important episode of his life, Paul Revere didn’t fire a shot. His job was to sound the alarm. Advisors often play a similar role. Clients don’t wake up thinking about powers of attorney, but they trust the professional who reminds them before a crisis makes the question urgent.
Asking about planning documents widens your role beyond products. It shows you care about the whole picture, and the conversation frequently uncovers needs for life insurance, beneficiary updates or long-term care planning.
The three documents, in plain English
- Durable power of attorney. Names an agent (attorney-in-fact) who can handle financial transactions for the client under the terms the client sets, including if the client becomes incapacitated.
- Health care directive. Sometimes called a health care proxy, living will or durable power of attorney for health care. It appoints someone to make medical decisions if the client can’t, and can record the client’s treatment wishes.
- Last will and testament. Lets the client decide who receives the assets they own, who manages those assets, who they prefer as guardian for minor children, and who serves as trustee of any trusts the will creates.
What happens when the documents are missing
Every state has legislation that fills the gap. If a client becomes incapacitated without a power of attorney, family members may need a court-supervised guardianship or conservatorship just to pay bills. If a client dies without a will, state intestacy rules decide who inherits, and a court chooses the guardian for minor children. These defaults are slower, more public and more expensive, and may not match what the client wanted.
For a deeper look at the incapacity side, see our article on incapacity planning.
How to start the conversation
- Add a simple question to your annual review: “Do you have a current will, power of attorney and health care directive?”
- Ask when they were last updated. Marriages, divorces, births, moves to another state and deaths of named agents all call for a review.
- Check that beneficiary designations on life insurance, annuities and retirement accounts line up with the will, since those designations generally pass outside it.
- Refer clients to their own attorney to draft or update documents.
Neither SRS nor you practices law or gives legal advice. We’re happy to look at a client’s existing documents with you so you can point them in the right direction before they meet with legal counsel.
Frequently asked questions
What are the three basic estate planning documents?
A durable power of attorney for finances, a health care directive (also called a health care proxy or living will), and a last will and testament. Together they cover financial decisions, medical decisions and the distribution of assets at death.
What happens if a client dies without a will?
State intestacy laws decide who inherits the client’s probate assets, and a court appoints a guardian for any minor children. Assets that pass by beneficiary designation, such as life insurance, generally still go to the named beneficiary.
Can a financial advisor help clients with wills and powers of attorney?
Advisors shouldn’t draft or interpret legal documents, but they can ask whether the documents exist, flag when they may be out of date, and refer clients to an attorney. That question alone adds real value.
Reviewed by Tim Fuller on 2026-09-26
Tim Fuller
President, SRS Inc.
Tim leads SRS Inc., a full-service IMO (Independent Marketing Organization) and BGA (Brokerage General Agency), connecting independent financial professionals with life, annuity, disability income, and long-term care solutions from 60+ carrier partners.
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