Estate Planning Basics: What Every Military Family and Business Owner Needs in Place
A surprising amount of people don’t have a will, let alone any additional estate planning documents.
Most of us know we should have a will.
However, a surprising number of people don’t have one. This includes disciplined, responsible adults who handle the rest of their financial lives carefully. Among those who do have a will in place, few of them have the complete set of documents that actually protects a family when it matters most.
Estate planning has a reputation for being something you do once, when you're older, when things are more settled. Unfortunately, that reputation is misleading. For military families and business owners in particular, the cost of postponing estate planning can be significant.
Service members face an elevated risk by the nature of their service. Deployments create extended periods where a spouse must manage all financial and legal decisions alone. PCS moves introduce ongoing complexity around state residency and legal jurisdiction. And the financial decisions made at retirement, particularly the Survivor Benefit Plan election, are among the most consequential estate planning choices a military family will ever face.
Business owners carry a different but equally real exposure. A business without a proper estate plan isn't just an asset at risk, it's a liability. Ownership interests, debt obligations, and operational responsibilities don't pause because of a death or incapacity. Without the right documents in place, a business built over decades can create serious financial and legal problems for the family it was meant to support.
Estate planning is not about expecting the worst. It is about protecting the people who depend on you regardless of what happens. Here is what needs to be in place, and why each piece matters.
The Will: Your Foundation
A will is a legal document that specifies how your assets should be distributed after your death. For parents of minor children, the will names a guardian to care for them if both parents die or are incapacitated.
Dying without a will is a legal state called “dying intestate”. In this situation, state law determines how your assets are distributed. That process rarely produces the outcome you would have chosen. Resolving intestate deaths is often a long process involving probate court, delays, legal fees, and family conflict over decisions that a well-drafted will would have resolved cleanly. It also means no one has been legally designated to care for your children other than whoever the court appoints.
For military families, the will carries additional complexities that require careful attention.
State of legal domicile matters. Military families move frequently, but legal residence (the state you've designated as your permanent home for tax and legal purposes) determines which state's laws govern your will. A will drafted in Virginia before a PCS move to Texas may not reflect the legal requirements or your current circumstances. It is wise to review your will after every major move.
Guardian designation is particularly important for military families in which both parents serve, or in which one parent deploys for extended periods. The will should clearly name primary and secondary guardians for minor children, and those guardians should know they've been named and be prepared for the responsibility.
For business owners, the will must coordinate with your business ownership documents. A will that leaves a business interest to a surviving spouse may create unintended consequences. This consideration is particularly important if the spouse is not positioned to manage or sell the business, or if you have co-owners whose rights weren't considered. Your will and your business succession documents need to be drafted together, not independently.
If your will was created before a marriage, the birth of a child, a PCS move to a new state, a divorce, or a business formation, it needs to be reviewed, and very likely updated. If you have recently left military service and settled in a new state, your will needs to be updated.
A DPOA authorizes your “agent” to make financial and legal decision on your behalf.
The Durable Power of Attorney: Your Financial Proxy
A durable power of attorney (DPOA) is a legal document that authorizes a named person, legally titled your “agent” to make financial and legal decisions on your behalf when you are unable to do so.
The word "durable" is important. A standard power of attorney becomes invalid if the person who granted it becomes incapacitated. A durable power of attorney remains valid specifically in that situation.
For active-duty service members, this may be the single most important estate planning document on this list.
During deployment, someone needs legal authority to manage your financial life at home: paying bills, accessing bank accounts, making real estate decisions, filing tax returns, managing insurance matters, and handling anything else that requires legal authority to act on your behalf. Without a DPOA, your spouse or designated family member may be unable to take necessary action, regardless of how obvious it seems that they should be able to.
The scope of the DPOA matters. A document that grants broad authority to manage all financial affairs may be appropriate for deployment, but may warrant review upon return. A more limited POA, which grants authority over specific accounts or transactions may be appropriate in other circumstances. Everyone should carefully consider whom they name as their financial power of attorney.
For business owners, a durable power of attorney that explicitly extends to business financial decisions ensures that someone has the legal authority to keep the business operating if you are incapacitated. Without this provision, business accounts, contracts, and financial commitments may be inaccessible during a period when they most need attention.
Healthcare Directive and Medical Power of Attorney: Your Voice When You Can't Speak
These are two separate documents that are frequently confused, and both are necessary.
A healthcare directive, also called a living will, specifies your wishes regarding medical treatment if you cannot communicate them yourself. It addresses questions like: do you want resuscitation attempted if your heart stops? Do you want to be kept on life support if there is no reasonable expectation of recovery? What are your wishes regarding organ donation? A healthcare directive gives medical providers clear guidance and removes these extraordinarily difficult decisions from the people who love you most.
A medical power of attorney, also called a healthcare proxy, designates a specific person to make medical decisions on your behalf when you are unable to make them yourself. The healthcare directive tells providers what you want; the medical power of attorney gives someone the legal standing to communicate and enforce those wishes when circumstances require a judgment call.
For military members, these documents should be in place before deployment without exception. The risk of traumatic injury during service is real, and the failure to have these documents in place can leave medical providers without guidance and family members without authority at the worst possible moment.
A practical note: JAG attorneys (Judge Advocate General legal assistance attorneys) provide estate planning services to active duty service members and their families at no cost. Most installations have a legal assistance office, and appointments are typically available within a reasonable timeframe. If you are active-duty and do not have these documents, scheduling a JAG appointment is a straightforward first step.
For business owners, name your healthcare proxy with an awareness of your business responsibilities. The person making medical decisions on your behalf during incapacity may also need to interact with your business partners, employees, or financial institutions. Ensure your business succession plan accounts for a scenario in which you are incapacitated but alive.
Beneficiary Designations: The Documents That Override Everything Else
This section exists alongside the will for a reason that most people don't fully understand until it's too late.
Beneficiary designations on retirement accounts, life insurance policies, and certain bank accounts pass outside of probate. They supersede your will entirely. The most carefully written, most recently updated will in the world cannot override an outdated beneficiary designation.
This creates one of the most common and most costly estate planning failures we encounter: a service member who named a parent as TSP beneficiary before getting married, never updated the designation, and whose spouse receives nothing from that account despite being named in the will. The will is irrelevant. The beneficiary designation controls.
Accounts that carry beneficiary designations include:
TSP — review and update at tsp.gov
IRAs and 401(k)s from prior or current employment
SGLI (Servicemembers' Group Life Insurance) — separate from TSP, requires its own update
VGLI (Veterans' Group Life Insurance) — if applicable post-separation
Private life insurance policies
Annuities
Bank and investment accounts with payable-on-death (POD) or transfer-on-death (TOD) designations
The action item is straightforward: create a list of every account or policy that carries a beneficiary designation. Verify who is currently named on each one. Update anything that doesn't reflect your current wishes.
Review beneficiary designations annually and after every major life event: marriage, divorce, birth of a child, death of a named beneficiary, or a significant change in family relationships. This review takes less than an hour and can prevent years of legal and financial difficulty for the people you leave behind.
At military retirement, service members make a one-time election about whether to enroll a survivor in the SBP.
The Survivor Benefit Plan and the Buy-Sell Agreement: The Estate Documents Most People Skip
For retiring military members: the Survivor Benefit Plan (SBP) election
At military retirement, service members make a one-time election about whether to enroll a survivor in the Survivor Benefit Plan. This decision is largely irrevocable (with limited exceptions) and the window to elect, modify, or decline coverage closes at retirement and generally cannot be reopened.
SBP provides a surviving eligible beneficiary with up to 55% of the retired service member's monthly retirement pay for the remainder of the survivor's life. The benefit is inflation-adjusted, unlike most private life insurance policies, which pay a fixed lump sum. Coverage costs 6.5% of the covered base amount, deducted from the monthly retirement check. After 30 years of paid premiums and at age 70, coverage becomes paid-up with no further cost.
The SBP election is fundamentally an estate planning decision. It determines whether a surviving spouse has a continuing income stream to live on. This question sits at the intersection of retirement planning and estate planning and cannot be answered by looking at either one in isolation.
Key questions to work through before the election: What would your survivor's income look like without your retired pay? Does your life insurance coverage — if you have it — produce enough of a lump sum to generate equivalent ongoing income? Have you modeled both the cost of SBP and the cost of replacing it with private insurance to understand which provides better value for your specific situation?
SBP versus private whole life insurance is not an either/or question. They serve different purposes. SBP is inflation-adjusted income for life. Whole life insurance is a lump sum. For many military families, the optimal answer is a combination of both. But that answer requires a deliberate analysis, not a checkbox on an out-processing form.
For business owners: the buy-sell agreement
A buy-sell agreement is a legally binding contract that governs what happens to a business owner's interest if they die, become permanently incapacitated, retire, or otherwise exit the business. Without one, the consequences of an owner's death can be severe.
When a business owner dies without a buy-sell agreement, their ownership interest typically passes to their heirs. Spouses, children, or other family members may have no interest in, no ability to manage, and no way to easily sell that interest. Co-owners may suddenly find themselves in business with a deceased partner's spouse. A family may find themselves holding an illiquid asset they cannot convert to cash and don't know how to manage.
A funded buy-sell agreement addresses this directly. It typically works in conjunction with life insurance: each owner carries a life insurance policy in an amount sufficient to fund the buyout of another owner's interest. If one owner dies, the death benefit funds the purchase of that owner's share from the estate. The co-owner can purchase the remaining shares at a predetermined, agreed-upon price. This leaves the surviving owners with full control and the deceased owner's family with liquid assets.
Two common structures: a cross-purchase agreement, in which each co-owner agrees to buy out a deceased partner's interest, and an entity-purchase agreement, in which the business itself buys back the interest. Each has different tax implications and ownership structure consequences.
If you have business partners or co-owners and no buy-sell agreement in place, this is an urgent gap. Even in a single-owner business, a succession agreement that specifies what happens to the business upon the owner's death such as sale, transfer to a family member, dissolution, is a critical missing document.
Putting It All Together
Estate planning is not a single document. It is a coordinated set of documents that work together to ensure that the people who depend on you are protected, your wishes are honored, and the assets you've built go where you intend them to go.
For military families and business owners, the stakes are higher than average and the gaps are more common than they should be. The good news is that the path forward is straightforward. Each of the documents we’ve discussed can be put in place, often with the help of free legal resources for active duty members, at any point you choose to prioritize it.
For military members: schedule an appointment with your installation's JAG legal assistance office. It is free, it is available to you, and it is specifically designed for exactly this purpose.
For everyone: if your estate documents haven't been reviewed since a major life event schedule a review now. Not next year. Now.
At Clear Insight Wealth Management, estate planning review is a core component of the financial plans we build. We help clients identify what's missing, coordinate with estate planning attorneys, and ensure that every piece of the picture fits together. If you'd like to start that conversation, we'd love to hear from you.
