It is essential to review your estate planning documents every couple of years or when life events change. Not all circumstances require amendments or modifications to your current documents; however, it is always good to look over your directions, appointments and pre-determined plans. If nothing else, it is a good exercise to remind yourself of what you have decided. If married this is a great time to bring your spouse in and walk through the plan together. Everyone needs to be on the same page.
Year-end is a logical time to review your estate plans. If updates are needed, make this a priority goal in the new year. If you are one of the many who do not have legal documents in place, consider executing legal documents in 2025 a top priority! Estate plans are for all ages, not only older folks.
What is estate planning?
Basically, estate planning as outlined by Charles Schwab Inc. in Estate Planning at Any Age: Start Early | Charles Schwab is the process of determining how you want your assets handled when you’re no longer capable of making financial decisions—either from death or incapacity. An estate plan also allows you to communicate medical requests, such as a do-not-resuscitate order or end-of-life care, to lessen the burden on your loved ones if you become ill or hospitalized.
Estate planning often involves putting together everything from a will and a health care directive to purchasing adequate life insurance, naming guardians for minor children or heirs with disabilities, and figuring out who will inherit your property and money. Making your estate simpler for your heirs is what is important.
When to review your plans?
Life happens and these events may trigger necessary revisions to your legal documents. A few key examples of triggering events include:
- Medical Diagnosis
- Home or a Second Home Purchase
- Retirement or Relocation
- Family Expansion
- Death of a Loved One
- Change in Employer Benefits
What review questions should you be asking yourself?
- Are my executed documents valid?
- Do my legal documents protect my assets and my body as I want?
- Do I have the right people appointed?
- Are tax or estate laws different now?
- Have my wishes or heirs changed?
- Do the key people involved know where to find this information?
- Should we hold a family meeting to share this important information?
As you work through the various questions listed above if you feel uncomfortable, uncertain or simply lost, this is probably a sign that you should sit down with a professional who can read through and summarize what is documented. A few hours of review may confirm everything is in good order and no action is required, or the review may uncover necessary amendments or changes.
Either way it is important to take the time and steps to keep your estate plans up to date. Also, it presents an opportunity to hold an estate planning discussion with the appointed persons. The more comfortable you become with your plan, the easier it will be to discuss the details with the key people. You can start the conversation with “as I was reviewing my estate plans, I thought it was a good time to bring you in on our wishes so that you were not caught by surprise” and go from there presenting your details and answering their questions.
Completing an estate plan review every few years should be on every one’s to do list. If you need some help getting started, please let us know. We have been working with individuals and families since 1984. Financial planning, estate planning and investment management are our core services.
For our Financial Year-End Checklist visit our blog to read our summary and resource article.
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The information presented is for your reference and is not considered to be a specific recommendation.
