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
tiffany@farrarwilliams.com
.
She can answer any questions you have about this subject.