When you first created your estate plan, you focused on the most important things in your life, like naming guardians for minor children, a basic will and maybe establishing a simple trust. If the date of your most recent estate plan is more than three years ago, it’s time for an update. If the last time your will was updated was ten, twenty, or thirty years ago, you’re seriously overdue for an update. A recent article from Coeur d’Alene/Post Falls Press, “Why your estate plan from 20 years ago needs an update,” reviews the key points to address.
Your children are adults. The guardian provisions are no longer relevant. Your adult children have different circumstances and needs than those anticipated years ago. One child might have built a successful business, while another might have made many poor life choices. The asset distribution structure from the past may no longer be relevant. New trusts with more control over the timing of distributions or consideration of your children’s spouses and children may be needed.
Changes in financial circumstances. You may have accumulated significant retirement accounts, built equity in real estate, or received an inheritance. New complexities won’t be addressed in an out-of-date estate plan. As estates grow larger, probate becomes more challenging. A simple probate process for your younger self might now be a lengthy and expensive process, taking a significant bite out of your estate.
Tax laws have changed. The recent tax bill is just one in a series of tax law changes that have occurred over the past five years. The change in federal estate taxes may not impact your estate. However, it is not the only change that needs attention. Retirement rules for traditional IRAs and 401(k) plans have undergone significant changes. Current beneficiary designations and distribution strategies from the past may no longer be effective.
Relationships change over time. Families are always changing, from divorce and death to new children and spouses. If you’re not happy with a son-in-law, estate planning can be used to protect your daughter from future difficulties. There are many types of estate planning tools available to protect assets from potential divorce, prepare for family conflicts, or ensure that a current spouse and biological children from a prior marriage are protected.
Health and incapacity planning needs an update. The same person you named as your healthcare proxy when you were thirty may not be the same one now that you are in your fifties. If you’ve been divorced, you likely don’t want your ex to oversee medical decisions. Planning for incapacity involves addressing care costs, protecting assets and appointing individuals to make legal and medical decisions with Power of Attorney and Healthcare Proxy documents.
If it’s been more than three years since you’ve updated your estate plan, if you’ve moved to another state, or if your life has undergone changes, schedule a consultation with an experienced estate planning attorney. Be sure your estate plan reflects who you are right now.
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.
