I am a firm believer that everybody “rich, poor, and those somewhere in-between” needs an estate plan. If you have never thought about an estate plan, perhaps that should be your New Year’s resolution.
If, however, you have an estate plan already in place but have not reviewed it or updated it in the past several years, perhaps that should be your New Year’s resolution. It is a common misconception that once you execute all of your estate planning documents, they do not need further attention.
However, it is a good idea to review your estate plan annually to ensure that it is current and still fulfills your estate planning goals in the event you become incapacitated or pass away.
It is also a good idea to review your estate plan if major circumstances have changed since you executed or last updated your estate planning documents. The following is a list of some family circumstances that could warrant an update to your estate plan.
- Marriage or divorce. In the event you get married, remarried, or get a divorce, you need to make any necessary adjustments to your estate plan and your beneficiary designations.
- The birth or adoption of a child. Your Last Will and Testament needs to include guardianship provisions for your minor children in the event something happens to you and/or your spouse.
- The death of a beneficiary. Chances are, updating your estate plan in the midst of losing a family member is far from your mind. However, it is an important step that must not be forgotten.
- A change in trustees, personal representatives, and trustees. Are your nominees still able and willing to serve?
Moving to a new state. Upon moving to a new state, it is important to have a lawyer review your current estate plan to ensure that it complies with state laws.
- A substantial increase in assets or income. If your assets are over the federal estate tax limits ($5,430,000 in 2015), you will likely want to structure your estate in a way that minimizes estate tax.
- Changes in the law. You will need to speak to an experienced attorney to make any appropriate changes to your estate plan if a major law changes regarding estate tax, probate, etc.
- Illness or incapacity. Have you outlined your desires in the event you become incapacitated in your estate plan? What if one of your beneficiaries becomes incapacitated?
These life changes can lead to disputes among your family that may have been avoided with a periodic review or update to your estate plan.
Tiffany is an associate attorney at Farrar & Williams, PLLC and can be contacted at 501-525-4401 or by email at email@example.com . She can answer any questions you have about this subject.
By: Tiffany Tucker