Every year you probably service your vehicle and see your doctor for your annual checkup, but do you ever give any thought to your estate plan? Just as your car needs attention to run smoothly, and your health needs to be maintained, your estate plan needs periodic review to ensure your family is properly cared for in the event you are unable to do so yourself.
You might be surprised to learn that changes in your life have caused your estate plan to be outdated or in need of a tune up. Here are just a few situations that indicate a review of your plan is in order:
- Changes in Assets: A purchase of a new home, the acquisition or selling of a business, new investments, and the addition of life insurance or retirement accounts may change your estate plan. If you purchased a home, is it vested in your trust? If you sold a business, the proceeds may require a different plan for asset distribution and for minimizing any estate taxes. In the event there has been a major decrease in your assets, this may have unintended consequences in the event your estate plan provides for general bequests of cash or specific bequests of assets.
- Inherited Assets: Inheritance being separate property may not automatically pass to your spouse upon your death. Any receipt of separate property assets should prompt a review of your estate plan to avoid probate and to ensure inherited properties are passed on to blood relatives rather than to a surviving spouse if that would be your intent.
- Divorce or Remarriage: If you have not updated your estate plan after a divorce or remarriage, your former spouse although legally divested with any right to inherit could create issues for your intended beneficiaries. If re-married, your new spouse may have acquired inheritance rights. Both of these situations require a review of your estate plan, or implementing a new plan.
- Birth of a Child: You may need additional life insurance, updated beneficiary designations, to nominate a guardian for your child and set up trust provisions to ensure inheritance to your child meets your objectives.
- Death of a Loved One: On the death of a beneficiary named in your estate plan or someone who may be nominated to be your executor, successor trustee, or agent on a durable power of attorney or health care directive, you need to review your plan to ensure your plan for distribution should be changed and update your nominees to ensure you have good alternatives in place.
- Illness or Injury: Whether it may be yourself, a beneficiary or someone in charge of your estate upon your passing or upon an incapacity, a major health issue may prompt the need for a special needs trust, updating of nominees, or if you do not have durable powers of attorney for financial and medical decisions, it is imperative these documents be created.
A number of personal or financial events can dramatically impact your estate plan and its ability to carry out your desires. Of course if you have no estate plan, you may leave your family both emotionally and financially devastated. If you believe you may need a review or a “tune up” of your estate plan, or if you need an estate plan, contact Susan Moore or Catherine Amador at our office. They are dedicated to providing quality legal services in estate planning, elder care and family law.