The entire point of an estate plan is to make sure that your will is carried out when you can’t decide anymore about matters relating to your estate. However, plenty of people tend to just draw up an estate plan and leave it at that. This can lead to complications down the line, especially if there are major life changes such as marriage, children (even just a single one, whether biological or adopted), and acquiring additional assets.
It’s important for your last will and testament to reflect an updated take on your assets, other concerns, and even expectations. Making sure the person you choose as executor is still who you trust to carry out your wishes down the line is just as vital.
Life is pretty unpredictable, and there can be multiple factors to consider when the time comes. As previously mentioned, events like marriage and having children will certainly affect the affairs of your estate. Think about things like any changes on the philanthropic end, divorce, death, a new car, a new house, remarriage, even any beloved pets.
Assuming there aren’t many major changes on your end, there may be shifts in the legal sense. Documents that were pulled together “to the letter” during the initial execution could be in a different status (or even have sudden financial implications) due to changes in state laws or whatnot years and years down the line. One of the many possible factors is federal estate tax adjustments.
This is why a good rule of thumb is to revisit your estate plan at least once or twice a year unless there’s a major occurrence that will require a more urgent update. Aside from what’s been mentioned previously, diagnosis of an illness that’s degenerative or chronic or a serious accident also counts as a reason to update.
Trust Changes Will Carry a Certain Effect
Revocable trust documents have to be updated as much as your Last Will & Testament. Distribution may not always be what you initially wanted it to be, and the management instructions you laid out when you first wrote it can easily change over time. A major purchase like a lot may have to be transferred to the trust. Do you have a disabled family member who started getting support from the government? Anything in your trust that affects them may have to be edited as well. In some cases, creating an irrevocable trust is the ideal way to maximise a financial position.
Hiring a lawyer who’s well-versed in how your current estate plan reflects on your finances and taxes is the best step to making sure this goes well. In some cases, people terminate their revocable living trust but forget the “pour over” Will, which transfers assets into said trust when they pass on. Professional guidance is the best way to navigate this.
Many people find it morbid to have an estate plan, but it’s actually a smart way of looking into the future. Having one that’s updated will make things easier for your loved ones should anything pass. It also prevents the possibility of sudden financial or legal issues over time.
Are you looking to consult with an estate planning attorney? Contact Ontario Wills today! We offer sound legal advice on wills and estate plans by videoconference.