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Wills and Trusts Annual Checklist

Clients often ask how often do they need to change, update, or restate their revocable living trusts and/or last will and testament (“Wills”). The answer is, of course, it depends. There are some major life events that may necessitate a change, or at least a review with your attorney. Below is a our Wills and Trusts Annual Checklist of 10 events or changes that make it appropriate to reconsider your current estate planning documents.

Wills and Trusts Annual Checklist:

  1. Have you moved? Each state has its own laws regarding Wills and Trusts, understanding how these laws interact is important. If you have moved since you completed your documents, you should talk with a local attorney to see if your documents need to be updated.
  2. Birth or Adoption? Your estate planning documents will typically contemplate additional children and/or grandchildren. However, some attorneys or clients do not draft their documents this way. You should check yours just to be sure.
  3. Death? Has one of your beneficiaries, an executor, a trustee, or a guardian passed away? If so, you may want to consider revisiting your estate planning documents to update them accordingly.
  4. Disability? Disabled beneficiaries create new planning considerations that may or may not have been covered in your documents. Likewise, if a guardian, executor, or trustee has developed a disability, you may want to consider replacing them.
  5. Have tax laws changed? The tax code changes, probably way too often. Tax code changes could significantly impact your estate plan and the tools you have implemented to meet your goals.
  6. Marriage or Divorce? Both can have an impact on your estate plan, especially if it is your own. However, even a guardian, trustee, executor, or beneficiaries divorce or marriage can mean it is time for an update. For example, some clients insist they list Bob and Sue, husband and wife, as the guardian of their children. If Bob and Sue get divorced, picking one of them will alleviate the concern of a custody battle.
  7. Are your children no longer minors? Many parents of minor children create revocable living trusts to protect their assets and their children. Now that their children are adults there may be changes in the way they want to gift.
  8. Drug or Alcohol Dependence? A beneficiary or key person named in your Will or Trust that has developed a drug or alcohol problem may be a sign that it is time to update your estate planning documents. For their protection, your beneficiaries, and yours.
  9. Have you received a substantial inheritance? Even if it is not enough to change your estate’s tax planning, you will likely want to sit down with your estate planning advisors to learn how to protect it. In most circumstances, inherited property is “separate property” and not subject to division in a divorce. However, there are many rules that guide how inherited property maintains this separate property identity and if it is not protected it can easily become commingled joint property.
  10. Have you reviewed your estate planning documents in the last two years? As a rule of thumb, I encourage people to review their estate planning documents at least every two years, or upon a significant event (i.e. items 1-9 above). We include a summary and list of key persons in our documents to help clients accomplish their bi-annual review. If you have these documents, schedule a time to review them every year or two. The easiest way to remember to conduct this review? I suggest setting it to an anniversary date or a holiday (i.e. Love your Lawyers Day).

This 10-point wills and trusts annual checklist is merely a guide and does not account for every situation. The points above are what I would call “major life events” and should be a great indicator that something in your plan may have changed. Many other factors may indicate it is time to change or update your estate planning documents. If you are not sure if you need an update, then it may be time to sit down with your attorney to double check.

Regardless of when you created your Wills or Trusts, this Wills and Trusts Annual Checklist will help you determine if it is time for an update. If you still are not sure, give us a call and we will try to help guide you through the analysis.

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