Estate planning is not a “one and done” process. Even the best laid estate plans can and do become obsolete as things change in our lives. They need regular maintenance to ensure they continue to provide the best protection possible for the testator him or herself and the loved ones left behind.
For example, you may have a current will that leaves the majority of your belongings to your spouse. A divorce later, however, and you may very well want to make new arrangements. Another example of why periodic review is necessary: You could have left listed assets to a loved one who sadly passed away before you, and you now need to account for the disposition of that property to someone else.
Here are several key elements of any comprehensive estate plan that you should periodically reexamine.
Powers of attorney and advance health care directives
These documents detail who will make important financial and medical treatment determinations on behalf of the testator if he or she is unable to do so. For that reason, they need careful periodic review to ensure that the people named are still the best people for the job. Is the person named as power of attorney trustworthy and responsible? Does my health care proxy have my best medical interests at heart?
Even if the named individuals seem perfect for the job, it’s key to include a back-up just in case circumstances arise where the first choice is no longer available or suitable.
If the documents are outdated because, for example, the person named as financial power of attorney has since passed away, immediate revision is needed to install a new power of attorney and to list a new back-up.
Take time to evaluate your will
It is important to review the named executor and guardian listed in the will as well as any beneficiary designations included. You want everything to be up to date and to clearly express your wishes. If you and a relative had a falling out, for example, you may not want them named in the will any longer. Alternatively, if the beneficiary of some of your property has passed away, you will need to remove their name and assign the affected property to another loved one.
You’ll also need a back-up for the important role of executor. The executor handles and supervises many aspects of the estate, and he or she will keep the process of settling things moving along.
Do you have a trust as part of your estate plan? Time to review that, too.
If your estate plan includes a trust, review it regularly to ensure that the beneficiary designations are appropriate. Furthermore, take a look at the structure of trust distributions. Is this how you want assets distributed to your beneficiaries? Has the trust been pre-funded? If not, how will that be done? Pre-funding the trust may make future administration simpler and less costly for everyone involved.
Kevin Tharpe
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