When Should an Estate Plan Be Reviewed?
Like a car, home, or garden, estate plans require ongoing care. Estate plans reflect the wishes and goals at a particular time in a person’s life. For example, when drafting a last will and testament during a person’s 30s or 40s, two key goals are protecting minor children by naming a guardian and ensuring the surviving spouse’s legal and financial protection if the chief breadwinner should
die unexpectedly. We suggest you revisit and review your estate planning documents every three years. For our clients, we don’t charge for the meeting, which can be in person or by Zoom.
Time for a Review
We have a Zoom online training session on “Reviewing Your Estate Plan” on Tuesday, February 6, 2024, at 6:30 pm. It will help you find the basic choices you made in creating your plan.
To register, you can click here.
Time brings changes to life and laws.
You may divorce and remarry, have children from a second marriage, or wish to be sure that children from your first marriage are not disinherited. Adult children don’t need guardians, but a developmentally disabled adult may require Special Needs Planning to protect their eligibility for government benefits while having access to money from the family to maintain their quality of life.
Life’s changes are one reason why estate plans need reviewing and updating on a regular basis. An annual review may be necessary for more complex estates, while for more straightforward, more modest estates, a review every three to five years should suffice.
Recent years have seen dramatic changes in state and federal laws regarding taxes and retirement accounts. An estate plan created ten years ago will likely contain many out-of-date strategies and missed opportunities.
Changes in relationships impact estate plans.
Most trusts and wills include people with roles like trustees, executors and guardians who are alive and well at the time of the last will’s drafting. However, if the executor of your last will has died, moved to another state, or isn’t a part of your life and refuses to serve, an out-of-date last will presents several problems. Did the last will include the name of a secondary executor, and is the second executor still available to serve? If not, your family may have to accept decisions a court-appointed administrator makes. Your family may petition the court to have a family member appointed. However, there’s no guarantee the court will honor this request.
Changing tax laws call for estate plan reviews.
Changes to tax laws in recent years have dramatically altered the estate planning landscape. Any estate plan created before the SECURE Act (January 1, 2020) needs a review.
The 2017 Tax Cuts and Jobs Act dramatically increased federal estate tax exemption levels. However, this is expected to be cut by half when
the law sunsets on January 1, 2026. An estate plan based on the 2017 TCJA with no provision for a federal estate tax exemption sliced in half may present significant estate tax issues for many Americans.
Last-minute changes create challenges.
Procrastination is part and parcel of estate planning, even for the most diligent people. Planning for incapacity and mortality is far better than putting family members in the position of guessing what their loved one would have wanted or battling with the court or each other over property distribution. Promptly updating a comprehensive estate plan also avoids the stress of needing last-minute changes.
If you haven’t visited your planning in the last three years, please call and schedule a review meeting. We look forward to catching up.
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Building wealth is only half the job. Protecting wealth for your loved ones and yourself is equally important. Through estate planning, business planning, and asset protection, our firm will help you protect everything you love — family, friends, and favorite charities. For more
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