Awareness of the importance of estate planning, shaped by the pandemic, has faded. In 2024, only a third of Americans had an estate plan. Even if you have made a plan for your future, is the plan you created during COVID still aligned with your life today?
A recent Wealth Management article, “COVID-19 Era Estate Plans Are Due For Review,” examines COVID-era estate plans and why they may be time to update. During the pandemic, many estate plans were created amid fear, urgency and lockdown restrictions. Many people just wanted to get something, anything, in place, in case they became among the 1.2 million Americans who died as a result of COVID.
Depending on the circumstances, roles might have been assigned, such as executor or administrator, based on convenience rather than suitability. The family’s priorities might have been dealing with emergency health concerns, financial uncertainty, or altered financial dynamics. This doesn’t mean the estate plans were drafted incorrectly; over the past six years, circumstances have changed, and it’s time for a review.
Even without a global pandemic, once an estate plan is signed, it’s not set in stone. Over time, things change, and estate plans must be adjusted to remain effective.
In addition, trusts must be properly created, assets must be moved into the trust and beneficiary designations must be coordinated to align with, not conflict with, the person’s wishes. If an asset is still titled in an individual’s name, it will bypass the trust, require probate, or be distributed to someone other than those intended. Trusts only control what they own.
Beneficiary designations act outside of the will and aren’t updated when the estate plan documents are updated. Insurance policies and retirement accounts are transferred to the named beneficiary, regardless of the will.
How often should estate plans be reviewed?
Estate plans work best when they are treated like cars or houses. They require regular maintenance. Every three to five years, or when major life events occur, like birth, death, marriage, divorce, or significant changes to health or finances.
The COVID pandemic taught many people just how quickly life can change. Regardless of when they were created, estate plans need to be kept up to date so that, if something were to happen today, the individual, their loved ones, and their assets are protected.
Legacy One Law Firm, APLC is an estate planning and probate administration law firm in Los Angeles, California, serving families throughout the State. Schedule a quick and easy consultation with our estate planning attorney, Sedric E. Collins, Esq., or call 323-900-5450.
