What a Letter of Instruction Is and Why Every Estate Plan Should Include One

You’ve done the hard work. You have a will. Maybe a trust. Beneficiary designations are in place, and your attorney has reviewed everything. Your estate plan is solid.

But when the time comes for your family to act on it, they may still find themselves searching for answers to questions your legal documents simply were not written to address.

Where is the life insurance policy? Who should call the financial institutions? What are the login credentials for the online accounts? Do you want a service, and if so, where?

This is exactly why a letter of instruction matters.

What Is a Letter of Instruction?

A letter of instruction, sometimes called a personal instruction letter or a side letter, is an informal document that accompanies your estate plan. Unlike a will or trust, it carries no legal authority. But what it lacks in legal weight, it more than makes up for in practical value.

Think of it as a roadmap for the people who will carry out your wishes. It fills in the gaps that formal documents leave behind, offering guidance, context, and critical logistical information that helps your loved ones move forward with less confusion and less stress during an already difficult time.

It can be updated at any point without the involvement of an attorney, which makes it one of the most flexible tools in your overall plan.

What Should a Letter of Instruction Include?

There is no required format, and the letter does not need to follow a legal template. However, there are several areas where this document tends to provide the most value.

Personal and biographical information – Include your full legal name, date of birth, Social Security number, and the location of important identity documents such as your birth certificate, passport, and marriage or divorce certificates. Your executor and family members will need these quickly.

Financial accounts and assets – Provide a clear picture of where your assets are held. List your bank accounts, investment accounts, retirement accounts, and any real property you own. Include the names of the financial institutions and the approximate account numbers. You do not need to include passwords here, but noting where that information is stored can be very helpful.

Insurance policies – List each policy you hold, including life, health, long-term care, and property insurance. Note the policy numbers, the names of the insurers, and how to contact them. For life insurance in particular, your beneficiaries will need to initiate a claim, and having this information readily available saves significant time.

Digital accounts and online presence – This is one of the most overlooked areas of estate planning. Include instructions for handling email accounts, social media profiles, subscription services, and any accounts that may carry a financial balance. If you hold cryptocurrency, this section is especially important. Digital assets like Bitcoin or other holdings are often stored in wallets that require specific access keys or recovery phrases, and without that information, those assets can be permanently inaccessible. Note where wallet information and recovery credentials are stored, and make sure at least one trusted person knows how to find them. Consider storing all login credentials in a secure password manager and noting its location in the letter.

Debts and obligations – List any outstanding loans, credit card accounts, or regular financial obligations your executor should be aware of. This helps prevent accounts from falling into delinquency before they can be properly addressed.

Funeral and final arrangements – This section can bring tremendous comfort to your family. Note whether you prefer burial or cremation, any preferences about a service or celebration of life, and whether you have made any pre-arrangements with a funeral home. If you have strong opinions about what should or should not be included, say so clearly and with as much detail as you feel is appropriate.

Guidance for sentimental items – Your will may address the distribution of major assets, but personal items often carry meaning that cannot be assigned a dollar value. A letter of instruction gives you the space to explain your wishes for heirlooms, jewelry, artwork, photographs, and other meaningful possessions. This kind of guidance can help prevent family disagreements and ensure that treasured items end up with the people you intended. It is also a natural place to share the things that do not fit neatly into any legal document: family stories worth preserving, personal letters you want passed along, or even a beloved family recipe that deserves to stay in the family.

Advisors and professional contacts – Include the names and contact information for your attorney, financial advisor, accountant, and any other professionals involved in your financial or legal affairs. Your executor will likely need to reach all of them.

Where to Keep It and Who Should Know About It

Your letter of instruction should be stored somewhere accessible, not locked away where no one will think to look. Share it with your executor and, if appropriate, a trusted family member. Let them know it exists and where to find it.

Because the letter is informal and can be updated freely, it is worth revisiting periodically. Life changes, accounts change, and preferences can shift. A good rule of thumb is to review your letter of instruction any time you review the rest of your estate plan.

A Simple Step That Makes a Real Difference

Legal documents establish what happens. A letter of instruction explains how. Together, they give your family something they will genuinely need: clarity.

At James Investment, we work closely with clients on estate and legacy planning that goes beyond the basics. That includes helping you think through the pieces that do not always make it into formal documents. If you have been meaning to get your estate plan in order, or if you are not sure whether your current plan covers everything it should, it may be worth a conversation.