Since creating your estate plan, have you thought about updating it? If you are like most people, probably not. However, the carefully thought-out plan you created years ago may not meet your current goals or family circumstances. To put things in perspective, consider a family that may sound similar to yours.
Meet the Smiths
John and Jane Smith created a will-based estate plan 30 years ago when their daughter, Sally, was born. They updated it four years later when their son, Steve, came along. Ten years ago, they created a solid trust-based plan and felt confident that their family, their finances, and their beloved dog, Spot, were fully protected. But over time, they stopped updating the plan.
Here is what has changed in the Smiths’ lives in the past 10 years:
- Their children, Sally and Steve, are now adults and have graduated from college. The Smiths should review the inheritance they planned for their children. Since they no longer support Sally and Steve’s day-to-day needs, they may want to reconsider when they want each child to receive their inheritance.
- Sally is married with two daughters, one of whom may have autism. Because one of their granddaughters may have special needs, the Smiths should consider leaving any inheritance to her in a way that protects her eligibility for needs-based government benefits. An outright gift could unintentionally disqualify her from receiving that assistance in the future.
- Steve is also married, and he and his wife are expecting their first child. With a new grandchild in the picture, the Smiths should revisit when and how much they want each grandchild to receive from them.
- John and Jane bought an out-of-state vacation home in Florida. The Smiths should make sure that their Florida vacation home aligns with their estate plan, whether that means transferring it to their trust, using a type of real estate deed known as a Lady Bird deed, or recording a transfer-on-death instrument, depending on state law. Taking the right steps now will allow them to enjoy the property while helping their loved ones avoid a separate Florida probate later.
- Spot had a litter of puppies but has since passed away. John and Jane kept two of the puppies. If the Smiths included Spot in their estate plan (for example, by specifying who was to take Spot when both John and Jane pass away or providing a sum of money for her continued care), they should review their plan to see if it mentions Spot by name or more generally covers any pets they might own at the time of their deaths. Depending on how those provisions were drafted, the Smiths may need to update their plan to ensure that their new puppies are properly provided for in the future.
Given these changes in their lives, do you think the estate plan the Smiths updated 10 years ago will still meet their needs and goals today?
Changes in Your Own Life
Like the Smiths, you have undoubtedly experienced life changes over time. Just think about the past few years. Have you moved? Do you have more children or grandchildren? Have you started a business, suffered health problems, or purchased a new home? Do you have new accounts and investments? Do you now care for a parent, pets, or dependent children? Have you remarried, divorced, or retired? Has someone you loved died? Have friends or family members named in your plan as trusted helpers moved away, or has your relationship with them changed? Are your children adults now and able to serve in your plan as a trusted helper? Do you want to help with the costs of your grandchildren’s college education?
Much can change in 10 years; your personal life, finances, and goals probably look very different today. Your estate plan should reflect those changes. In addition, the laws governing estate planning continue to evolve. We stay on top of these developments so we can protect our clients in the most effective ways possible, which means that the strategies and tools we use today may be even better than those available when your plan was first created or last updated.
Is Your Estate Plan Out of Date?
If any of the changes the Smiths experienced sound familiar, or if it has been more than three to five years since you last reviewed or updated your estate plan, it is time to ensure that your plan still reflects your goals and protects the people and things you care most about now.
Barreau Legal, PLLC is an estate planning law firm located in Port St. Lucie, Florida; Orlando, Florida; St. Paul, Minnesota; and the District of Columbia. It has the background and knowledge to craft a solid estate plan to help preserve your legacy for generations to come. Barreau Legal, PLLC would love to hold an Initial Planning Session to discuss building your Generational Wealth Plan! If you have concerns about how your assets will pass when you die, ensuring your wishes are protected during your lifetime, or keeping your estate out of probate, please reach out to Barreau Legal, PLLC for your Initial Planning Session at 772-236-5204.