If you have already taken the time to make a plan for what will happen to your estate after you pass, you are more prepared than 60% of Americans when it comes to preserving the wealth you have accrued over your lifetime. Estate plans are not only for the elderly or those with a high net-worth, yet many people have suffered due to this false assumption. A reputable estate planning attorney can build the right plan for you and your family after your death or incapacity.
However, did you know that you should be updating your plan often? Unfortunately, many people think that an estate plan is something that is set in stone, which is false! It is recommended that wills, trusts, and other estate planning documents be reviewed and updated at least every 3 years. In this blog, you’ll get a review of what a basic estate plan entails, as well as the five most important reasons to take the time to update it regularly.
What Does An Estate Plan Entail?
If you already have some form of an estate plan established, you will know the purpose of many of the following tools that are commonly included. They are:
A will – a will details your assets and property, as well as the beneficiaries you would like to inherit them following your death. With only a will, your estate will still go through the Florida probate process, which is lengthy, expensive, and involved. There are many different types of wills, but the most common are testamentary wills, joint wills, and pour-over wills.
A trust – a financial entity to which your estate is transferred to be managed by a trustee, to the advantage of your beneficiaries. Trusts are highly gratifying because they pass directly to your heirs without going through the probate process. Some common types of trusts are revocable, irrevocable, special needs, and charitable remainder.
A power of attorney – this allows you to name a person you trust to make all medical, financial, and legal decisions for you in the event that you become unable to do so yourself. You are able to limit the powers based on your own desired terms, and they will cease to be effective after your death.
An advance directive – these are commonly referred to as living wills, and express your wishes for medical care and other artificial forms of life support if you become unable to do so yourself.
Why Would I Need To Update It?
It’s possible you have some of the items above already founded, but what if you wanted to add to your plan? For example, you may already have a will drafted, but now want to establish a trust after learning that they don’t have to go through probate to be passed to your heirs. With the help of an experienced estate planning attorney, this would be simple to accomplish. This is why reviewing and updating your plan periodically is so important!
Here are five more reasons why you should make updating your estate plan a priority:
Reason #1: Change In Marital Status
If you first established your estate plan when you had a different marital status than you do now, it’s likely that it needs to be updated. You may have gone through divorce, gotten married, or unfortunately endured the death of your spouse. In instances like this, you will probably want to add or remove individuals from your existing estate plan. This is not only crucial when it comes to who inherits your assets, but also when it comes to the people who are able to make medical or legal decisions for you.
Reason #2: Birth/Adoption Of Child Or Grandchild
Another change in your immediate family may be the addition of a child or grandchild. It’s fair to say you’ll probably want to include them as a beneficiary in your will or trust. If the addition is your own child, you’ll also need to consider establishing a guardianship designation which names the individual you want to be your child’s guardian in the event that you die or become incapacitated. With the absence of a designation, the court will be the one to decide who is to look after your child. You know your child and family better than the state, so don’t leave this incredibly crucial decision up in the air.
Reason #3: You Moved To a Different State
Estate and probate laws vary by state, so if you have moved since you established your existing estate plan, you should have it reviewed by an estate planning lawyer in your new state. They will be able to revise your existing plan or update it to ensure that it is compliant with the current laws.
Reason #4: Your Child/Children Have Turned 18
Once your children are no longer minors, it is time to review and update your estate plan to properly recognize a new adult beneficiary. You may even want to create another power of attorney that ensures your child/children can have a hand in making decisions in your stead.
Reason #5: Your Views On Medical Care Have Changed
There are any number of reasons that an individual may change their views on the medical care they do and do not want to receive, and you have a right to do so. A diagnosis of a serious or terminal illness may cause you to rethink the advance healthcare directives you established in the past. Therefore, they should be updated to reflect your new and current wishes.
Elder Law, P.A. Can Make Updating Your Estate Plan Painless!
To stress once again, it is recommended that your existing estate plan be updated at least once every 3 years! When you really think about it, you have probably gone through countless life changes in that amount of time, so your plan should accurately reflect them. Our lead attorney, Ryan J. Smollar, has over 10 years of experience in the estate planning and probate areas of elder law, so he knows the kind of compassionate and dependable service clients need to go through a legal process that can often be difficult and complex. Call today to schedule a free consultation and learn more about how we can assist your estate planning needs!