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How often do I need to revise my estate plan?

Feb 21, 2012 by Herman from Denton, TX in  |  Flag
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Herman...David & James have provided some great points. To add to their comments, I recommend reviewing and or updating your estate plan at least every 3 years or whenever a significant life changing event occurs (e.g., getting married, a divorce, changing jobs, at retirement, starting a business,having a baby, moving to another state, at the death of a spouse or a beneficiary). At the completion of a good estate plan (or review) you should be able to know the answer to - What happens if I'm disabled and/or incapacitated and unable to make decisions for myself? and What happens when I die? Finally, pay specific attention to who you designate to manage your estate at your disability or death. Frequently people will name a spouse or child for this responsibility. In itself not a bad idea. However, most people do not have the experience or expertise to handle all the tasks necessary. Consider preparing a letter of instruction to your agent, personal representative or successor trustee (if applicable) outlining who they should call to provide the technicall assitance necessary to make sure thing run effciently.

Comment   |  Flag   |  Mar 19, 2013 from North Salt Lake, UT

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Herman - The answer to this question depends very much upon your particular circumstances. You will want to ensure that your advance directive and medical power of attorney are in compliance with the current laws of your state, so keeping an eye or ear out for changes in this area is a good idea.

Much estate planning is focused on tax mitigation, which depends upon your asset base, current tax rates, and expected future tax rates. If you read any financial periodicals then you are aware of the roller coaster that estate planners have been riding the past few years. If you have substantial assets and have not recently updated your plan, now is the time to do it.

The current $5mm unified credit ($10mm for married couples) may not last, so many estate planners are advising individuals to make important planning decisions in 2012. The low interest rate environment is also favorable for many common estate planning techniques. If you have a financial advisor and an estate planning attorney with whom you work well, it is not a bad idea to ask for a high level review every couple of years or more often during times of significant change. A well-designed plan should not require a lot of attention if the underlying environment has not changed, but your advisors may have new ideas or ways to improve your situation.

Comment   |  Flag   |  Feb 21, 2012 from San Francisco, CA

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Herman, I recommend you review your trustee list beneficiaries at least every three years. In addition to those minor changes, a call into your estate planner that often should be made just to have them check and ensure your provisions are up to date. Most plans drafted these days have provisions that will flow with the environment, but that may not always be the case, or some more drastic changes to legislation may occur either federally or within your state. Other provisions may be relatively new concepts. For example, the idea to include a “protector clause” has gained popularity in recent years. This provisions allows your beneficiary to ask independent parties to have the current trustee replaced with the next trustee in line. For example, this can protect the beneficiaries if your brother is the trustee and he gets Alzheimer’s. So in summary, please review the parties in your documents for updates, and also check in with the planner every three years.

1 Comment   |  Flag   |  Feb 22, 2012 from East Dundee, IL
Paul Grant Truesdell

I'll keep it simple. Changes in physical, emotional, intellectual, relationships and financially should all trigger a conversation with the primary individual selected to provide estate planning advice. Legal documents (Wills, Trust, POAs, Letters of Instruction, etc...) should always be modified only by a licensed attorney licensed in the state where residency is established; just make sure to use one that knows what they are doing. As far as time goes if everything is SOS, two to three years is about right for those without issues and under the age of 75. Around the mid 70s, life can change pretty quickly for the worse; therefore, a bit of prodding and encouragement may be needed to keep matters current.

Flag |  Apr 08, 2014 near Ocala, FL

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