Over time, your priorities and relationships change. So do tax laws. Review your estate plan to make sure it is still aligned with your wishes.
At the heart of every estate plan are three goals: wealth preservation, asset distribution and planning to give control to a trusted person to make medical and financial decisions on your behalf if you are not able to do so. All three require a good deal of thought, planning, and the advice of skilled professionals. But the one thing that many people don’t address is the simple fact that things change. You may not want the same person you named five years ago to handle your affairs in the event of your passing or incapacity. A divorce or a break with a family member may also cause you to change how you want to distribute your assets.
The (Oak Creek AZ) Villager recently considered why it is so critical to review your estate plan every few years in “Updating your estate plan—When should you review?”
Over the years, your personal and financial health, along with your outlook on life may change to a great degree. So it’s key to be aware of the life events that may necessitate an updated estate plan.
- Just married or divorced? If so, your estate plan will need revision, and if your children or grandchildren marry or divorce, that’s another call to your attorney.
- Any loss or serious illness within your family? If yes, your named executor or health care agent may need to be changed. Also, if a family member is now physically or financially dependent on you, that’s another reason to review your plan.
- Has your net worth changed a lot since created your plan? If you’re now wealthier (or much less wealthy), your ideas about how you want your assets distributed at your death may have changed. Maybe you want to give more to a favorite charity or to one of your heirs.
- Changed your mind about what you want your wealth to accomplish? You might think of your wealth differently than you did when you were in your 20s.
- Have your executors or trustees changed their mind about their roles? That can happen. If they’re no longer interested taking on the task, they’re passed away, or no longer have capacity, its revision time.
- Retired, moved to another state, or bought or sold real estate? A yes to any of these events means an estate plan review with your attorney.
First, when you revise your estate plan, you need to update essential documents. This includes not just your will or your trust, but also your financial power of attorney and health care proxy. The next step is to review your risk management. Perhaps a trust created long ago needs to be modified or swapped out. Check your life insurance beneficiary forms for any updating.
Third, be certain that your assets line up with your plan, such as transferring ownership of all those assets that are going into a revocable trust, as well as adding acquired new assets.
Your life isn’t the only thing that changes. Tax laws, markets, and changes to the business climate may also have a big impact on your estate plan. Your estate plan’s strategy needs to keep up with these changes. Don’t miss out on new opportunities because you didn’t want to be bothered with a review. Contact your estate planning attorney. You might not need an overhaul, just a quick look under the hood to make sure everything’s running well.
At Legacy Counsellors, P.C. we understand that life is an organic process filled with unexpected change. Our firm uniquely offers a Continuous Care Maintenance Program that allows you to make changes to your Revocable Living Trust and associated estate planning documents. If you are interested in creating an estate plan that can grow with your family, please call our office today to schedule and initial consultation. (413) 527-0517
Reference: (Oak Creek AZ) Villager (October 29, 2016) “Updating your estate plan—When should you review?”