Which of the following is NOT typically considered a core component of an effective estate plan?

• A. Will
• B. Enduring power of attorney for finances
• C. Power of attorney for health
• D. Investment policy statement

Answer: (D)

The main idea is telling which documents are typically used to control what happens to your assets and decisions if you’re unable to act, versus documents that govern how investments are managed. A will is a primary estate-planning document because it directs asset distribution after death. An enduring power of attorney for finances designates someone to handle financial matters if you’re incapacitated. A power of attorney for health (or a health care directive) designates who makes medical decisions when you cannot. These items are fundamental to guiding your affairs during incapacity and after death.

An investment policy statement, while very useful in guiding how your investments are managed and aligned with your goals, isn’t about who inherits assets or who makes decisions for you. It focuses on investment goals, risk tolerance, and governance of investment decisions, which is more about ongoing wealth management than the core estate-transfer and incapacity planning. So it isn’t typically considered a core component of an estate plan, though it can complement the broader financial plan.