'He is also the sole beneficiary of my 403(b) accounts'

"My house and car are set up as transfer-on-death, as are my bank accounts." (Photo subjects are models.)

Dear Quentin,

I am 73 years old and have $1.3 million in assets. My house and car are set up as transfer-on-death, as are my bank accounts, and they will all transfer to my son upon my death. He is also the sole beneficiary of my 403(b) accounts.

However, my son has a genetic disease that could potentially be fatal, and he does not have a spouse or children. Is there a way to name an alternate or contingent beneficiary in case he passes away before I do, without creating confusion or complications with my estate plan?

What else should I be thinking about at this time?

The Mother

Related: 'We fear financial exploitation': Who will manage our finances if my wife and I become incapacitated?

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. The Moneyist regrets he cannot reply to questions individually.

This is an opportunity to have a broader estate-planning conversation with your son about what he would like to do with his own assets and his inheritance when that time comes.

Dear Mother,

Love comes in many forms: planning ahead is one of them.

You can certainly name contingent beneficiaries in the event that your son predeceases you. This is also an opportunity to have a broader estate-planning conversation about what he would like to do with his own assets and his inheritance when that time comes. That includes healthcare proxies, plus durable and medical powers-of-attorney documents.

There are many ways to make sure that your son receives his inheritance, including adding him as a beneficiary on some of your accounts, as you have already done, and passing your house to him with a payable-on-death or transfer-on-death deed. All of this will make the transfer of assets easier and will help avoid probate for a large portion of your estate.

If, as the account owner, you had a will leaving assets to a third party, it would not override a valid beneficiary designation. A payable-on-death or beneficiary designation is a contract and, as such, trumps a conflicting provision in the will. However, if that designation failed, that portion of the estate may once again become part of the account owner's estate.

When putting together an estate plan, appoint an administrator/executor of your estate. A durable power-of-attorney document oversees your financial and medical decisions if/when such issues arise. A medical power of attorney, on the other hand, handles your healthcare and medical treatment decisions. This is important for you and your son.

Who will manage your affairs if you become incapacitated? Do you have a "do not resuscitate" order - a directive written by a healthcare provider to instruct doctors not to perform CPR or other life-sustaining measures in the event that your heart or breathing stops? If no such order exists, hospital staff will automatically initiate all life-saving measures.

While both are legally binding, there is also a difference between a "do not resuscitate" directive and an advanced healthcare directive. The former is specific to life-sustaining decisions, while the latter is a more far-reaching document overseeing a range of decisions like appointing a healthcare agent and deciding on hospital choices or even nursing homes.

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An estate-planning checklist

It's easy to put off forming an estate plan, and choosing an executor is another important step. An executor has a fiduciary duty to act in your best interests and is required to produce an inventory of the assets, expenses, sales and other matters (like tax documents). It's not a job for the faint of heart, as it's time-consuming and carries legal responsibilities.

Believe it or not, it takes an average of 16 months to settle an estate and approximately 570 hours of work, according to a survey by the software company EstateExec. Debts and conflict among any beneficiaries can also complicate matters. Being an executor is not a job for the faint of heart, but payable- and transfer-on-death deeds certainly simplify matters.

The National Council on Aging offers this checklist. "To make things easier for your executor and family members, it's a good idea to gather and store important documents in one safe location. These documents may include: birth and marriage certificates; property deeds and mortgage documents; insurance policies; [and] bank and investment account statements."

The NCO advises reviewing your beneficiary designations to make sure they're current, and making a list of all assets. You appear to be on top of this, but for anybody else out there reading this, those documents include life-insurance policies, retirement accounts (401(k)s, IRAs, pensions, etc.), bank accounts or brokerage accounts with payable-on-death options.

Lastly, plan for your memorial service. "Your estate plan should include instructions for final arrangements that reflect your personal values and preferences," the NCO says. "Be sure to outline specifics pertaining to burial or cremation and any desired music, readings or religious elements. Consider prepaying or prearranging funeral or memorial services."

None of these are easy conversations to have, and few people like to think about illness and death. As we get older and, in some cases, face ill health, these matters lose their taboo power over us and become a more practical part of our housekeeping: "Write will. Set up beneficiaries. Vacuum house. Appoint an executor. Spend quality time with my loved ones."

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By emailing your questions to The Moneyist or posting your dilemmas on The Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

More columns from Quentin Fottrell:

'I'm not interested in long-term care insurance': I'd like to retire at 55. How much will I have to pay for healthcare?

'We are committed Christians': Our son and daughter-in-law cut us off over politics. Should we change our $3 million will?

'He is increasingly angry': My troubled son lives with me. How do I ensure he is financially secure after I die?

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-Quentin Fottrell