Estate planning is in part about having peace of mind that “you’re all set.” In other words, you’ve put together a plan that will play out the way you intended upon your disability or death.
If you’ve done an estate plan, you should still ask whether “you’re all set” every once and a while. Getting a plan together in 2005, 2015, or even 2020 doesn’t necessarily mean your estate plan will be carried out as was originally designed.
These are the key issues to think through to figure out if “you’re all set:”
- Does your estate plan still meet all of your goals? Very likely, you have multiple goals for your estate plan. One is probably to make the process as easy as possible for your family or loved ones and avoid the cost as well as the hassle of probate. Another is likely to determine how to leave your assets upon your passing. A third goal is likely to appoint who will make your financial as well as medical decisions when you’re unable. Your goals may change over time though. You may start to have health issues and become concerned about whether your planning will allow you to afford the cost of assisted living or nursing home care. One of your children may have financial issues and you want to avoid having the inheritance go directly to that child. Or, your business has been blessed financially and you now want to avoid the estate tax. Through all of these changes in life and others, you should find out if your estate plan still meets all of your goals.
- Has anything happened to require changes to your estate plan? As I mentioned earlier, if your estate planning goals change, it’s very possible your estate plan needs to be updated to reflect them. Also, life circumstances can require changes in your estate plan. For example, you may have decided to be geographically closer to your children/grandchildren and moved to another state in retirement. Perhaps one one of the children you chose to be your health care power of attorney has moved and is no longer close enough to step in to help care for you when it’s necessary. Or, one of your children has marital issues and you’re concerned leaving an inheritance directly to that child would cause even more strife in the marriage. Identify changes in your life as well as your family and find out if your estate plan should be updated to address them.
- Will the process go smoothly for your family and beneficiaries? Ask your estate planning attorney how your estate plan will be implemented on your disability and death. In this process, you should think through the particular dynamics of your family and financial circumstances. Focus in particular on possible challenges with the implementation of your estate plan and how they might play out. One set of challenges could be with family dynamics. For example, one of your children (or even a spouse of that child) may have a broken relationship with the child you’ve chosen to make financial decisions. Understanding how they’ll interact in this process may highlight issues that should to be handled differently than you originally thought. This discussion with your estate planning attorney might also identify challenges with the transition or sale of certain assets. For example, perhaps more than one of your children will want to inherit your house because it’s been in the family for multiple generations. In this case, should your trust establish a process for how the trustee will offer the house to all of your children? Talk through what the implementation of your estate plan will look like, identify possible challenges, and explore what can be done to proactively address them to make the process as smooth as possible for your family and beneficiaries.
If you have any questions about your estate plan and whether “you’re all set,” feel free to contact me at phmulder@cunninghamdalman.com.
