Many people make New Year's resolutions to better themselves or accomplish certain goals. If you haven't reviewed your estate plan in the past year, we suggest that you include a review of your existing estate plan in your resolutions for 2021. Below is a list of items you should review at least once a year:
- Beneficiary Designations. Most financial accounts allow you to designate a beneficiary to receive assets in that account in the event of your death. Beneficiary designations take precedent over estate planning documents, so it is extremely important to make sure that these designations accurately capture your wishes. Many times, beneficiary designations are not updated following major life events (like marriage, divorce, death of a beneficiary or the birth of a child). Keep in mind that whomever is identified on the most recent beneficiary designation will receive the money, regardless of what your other estate planning documents provide. Check with your financial advisor or investment firm to ensure that your beneficiary designations are current.
- Real Estate. Have you moved or purchased additional real estate since your estate planning documents were signed? If so, you should check to make sure that the ownership of your real estate is consistent with your overall estate planning objectives. If your estate plan includes a trust, and you have acquired new property, or even just refinanced your current property, it is possible that the property is not titled in the name of your trust, which can frustrate your intentions. If you own property jointly with another person, you should also check to be sure that the form of joint ownership accurately reflects the intentions of both owners. Updating the ownership of property is often a simple process, and can save a great deal of time and money in the long run. Double check the most recent deeds for all of your real property to be sure that the property is titled as you intend it to be.
- Title to Other Assets. If your estate plan includes a trust, you should ensure that your Trust is the owner or beneficiary of all of your assets (with the exception of certain retirement accounts that should most often identify individual beneficiaries). Real estate, bank accounts, life insurance, business interests and all other assets should either be titled in the name of your trust now, or have your trust designated as the beneficiary upon your death. Many trusts are not properly funded when they are created. Further, ownership of assets often changes over time, and the trust is not properly designated. If you have assets outside of your trust, those assets may end up needing to be probated upon your death, which is what trusts are often designed to avoid.
- Business Interests. If you own a business, do your business documents outline what will happen to your ownership interest in the event of your death? Operating Agreements or Shareholder Agreements often contain provisions for the purchase of a deceased owner's interest, and may provide for continuity of management upon your death. Review these documents carefully to be sure they are consistent with your wishes and the wishes of the other owners of your business.
- Nomination of Agents. Take a close look at your Will, Trust and Powers of Attorney to confirm that the agents you have nominated in these documents are still able to act, and are still the individuals you wish to have nominated in these roles. If any of your agents have had major life changes since the time you named them, you should consider naming alternate agents.
- Protections for Minors. Many times, a main motivation for preparing an estate plan is the protection of minor children. As those children grow up and are no longer minors, the estate plan may no longer need these protections. Wills and trusts should be updated to remove provisions for Guardians/Conservators of minors when those are no longer necessary. On the other hand, if you now have minor grandchildren or other minors you wish to support, perhaps a revision to your Will or Trust is necessary to make adequate provisions for those minors.
- Disposition of Assets. Does your Will and/or Trust still accurately identify your wishes for the disposition of your assets upon your death? If your wishes have changed, the individuals identified as recipients of assets are no longer living (or you no longer wish to make provisions for those individuals), an amendment to your Will or Trust should be prepared to accurately capture your wishes.
- Location of Important Papers. Do your agents know where to find copies of your estate plan and your other important papers (such as investment account statements, funeral and burial arrangements, etc.)? You may wish to consider preparing a letter or list for your agents so they know where to turn if and when they need to act for you.
Reviewing your estate plan with an attorney every 3-5 years is also wise. If it has been quite some time since your estate plan was last reviewed, contact us today and we would be happy to help!
If you don't already have an estate plan prepared, make a resolution to get it done in 2021!
Whether you are looking to prepare a new estate plan, or to update an existing estate plan, Lumbertown Law would be happy to help. Contact us today to learn more about our estate planning services.