The beginning of a new year is the perfect time for you to look over your estate planning documents and make sure everything is according to your wishes, particularly as affected by the previous year’s events.
When updating your documents, you should consider not only the property and assets that are being distributed, but also the people involved. Carefully consider beneficiaries as well as people with whom you have entrusted other responsibilities, including the executor of your will, trustee of a trust, power of attorney, and guardian of your children.
So what exactly should you be looking for as you update your estate planning documents? What follows are some possible events and circumstances that may require changes in your will or other estate planning documents:
1. Marriage. Did you, your child or another family member named in your documents get married?
2. Divorce. Did you, your child or another family member named in your documents get divorced?
3. Birth or adoption of a child, grandchild, etc. Did you, your child, or someone else give birth or adopt a child that you would like included in your estate planning? Do you have to name a guardian for your children in case of your death?
4. Child has reached the age of majority. Has a child named in your estate planning documents turned 18 or otherwise reached a milestone set in your estate plan?
5. Death or serious illness. Has someone named in your estate plan died or fallen seriously ill, especially if it’s someone who has been named as your executor, power of attorney or trustee?
6. Changes in relationships with people, pets or organizations. Do you have a new relationship with someone or an organization you would like to include in your planning? Alternately, have you severed any such relationships?
7. Purchase or sale of major assets. Have you bought or sold a house, opened or closed a business, etc.?
8. New insurance policies or pension plans. Have you acquired new insurance policies or pension plans that require adjustment of beneficiaries in your estate plan? Have you reached the age at which you are required to take distributions from a pension plan?
9. Change of your state of residence. Have you moved and inadvertently made part of your estate plan invalid?
10. Tax law changes. Are there new or different provisions in the tax law that affects your estate distribution plan?
Likewise, if you don’t have all the estate documents you’d like, you may want to look into creating the ones you are missing, including a last will, living trust, living will, power of attorney or pet protection agreement.