Ten Warning Signs that Your Estate Plan Needs Help

How do you know if you need to update your estate plan? It isn’t like your smoke detector that mercilessly beeps, warning you that you could be in danger if you don’t replace its batteries. But what are the warning signs of an outdated, incomplete, or ineffective estate plan? 

Here are 10 indicators that let you know when you should consider updating your estate plan.

1. The passage of time should make you uneasy.

• The law on estates, trusts, and taxes changes every few years. If it has been more than three years after signing a plan, you have cause to be uneasy. You may be fine…or not.
• You do not know what your estate plan consists of. This is common.
• You have heard about a new technique or trust and wonder if it’s right for you.

2. You don’t have 100% confidence in what you have in place.

• You wonder what changes in the law or your family or finances may mean.
• You have a trust you don’t understand.
• You have an irrevocable trust and wonder if it’s right for you, and what you can do about it if it isn’t.

3. Things have changed in your family.

• You have new children or grandchildren.
• You need to change the guardian for your children.
• One or more of your children are now young adults and you have no legal right to act for them should they need it.
• You need to change the distribution scheme (e.g., a new beneficiary has arrived or another has died or fallen from favor).
• You have a family member with a disability or an addiction.
• You have had a marriage or divorce in your family or one on the way.
• You have changed your state of residence.
• Your spouse has died.
• Your own parents are very elderly and you wonder whether their affairs are in order, and how to approach the subject.

4. The people you would put in charge have changed.

• You want to discuss the trustee and power of attorney choices you’ve made.
• You would like to know about the option of a professional trustee or executor to settle the estate, including the cost.
• You wish to consider a professional trustee for the permanent job of managing assets for your heirs.

5. Your own health is uncertain.

• You currently have a health care proxy provided by the hospital, which is skimpy on details.
• You have heard about a medical directive – under which you specify your wishes on the particulars of your care should you have an advanced illness.
• You may now or in the future be in need of long-term care and want to learn about some options for paying for it and protecting assets.

6. What you own has changed.

• You have started a business or closed one.
• You have purchased a vacation home or investment property.
• Your wealth, if you were to die today, has increased to over $1 million, which is the estate (death) tax exemption in states like Massachusetts. You wonder what your options are to reduce or eliminate the estate tax.
• Your wealth may or has already increased to over $11 million dollars, subjecting you to the latest federal estate taxes and you are unprepared to eliminate or minimize the tax (at 40%). You wonder what’s coming next in the estate tax.

7. You wonder if your trust is funded properly and fulfilling its purpose.

• You want to be sure that your assets are all properly titled to your trust or trusts, or sometimes directly to individuals.
• You gave up on funding your trust several years ago when you were told, “Oh we don’t do that here,” at your bank or financial institution.
• Your home has never been transferred to your trust and you wonder if now is the time.

8. You wonder how to choose good advisors and put your current advisors to the test.

9. Staying up-to-date seems overwhelming.

• You would like to be part of a regular system for staying up-to-date in your estate plan, learning about the latest strategies, having confidence in your plan, and getting all the tax breaks you deserve.

10. You want to involve your children or parents in estate planning so everyone is on the same page.

• You’d like your family to understand the plan, the process, and the key players, so there are no surprises.

No surprises – that is the goal. We can help. If you’d like to discuss your unique situation, please schedule a free 15-minute consultation with Paula Nolan, Estate Planning Paralegal.

You may also want to check out our new Diagnostic Tool.