Is estate planning a one and done deal?… or does it, like your retirement planning, require ongoing attention and review?
Estate planning provides the individual control over their assets. That control provides certainty, flexibility, and assurance that their hard-earned assets are protected and treated in the manner in which they decide – not the government, not the state, not their relatives.
While not as visited of a process as retirement planning or cash flow analysis, estate planning can be a fluid process. Life events constitute the majority of reasons to analyze your estate planning.
- Your health – A health event can trigger a change in your plan by requiring incapacity planning, new and unanticipated medical costs, and longevity changes in accomplishing your financial legacy.
- Life, death, or relational changes. The birth of loved one, the death of a loved one, divorce, adoption, etc. Any number of individuals’ inclusion in your life requires a reevaluation of your plan to ensure beneficiaries are updated and titles to accounts are properly reflected.
- Your life choices – Did you move to another state?… country? Wills, deeds, revocable trusts, are some of the documents that could be affected by ancillary probate if not properly handled.
- Business – are you evaluating selling your business? Many business owners do not properly plan for a sale of business until after the sale has concluded. They then find themselves with hefty tax bills and the inability to properly title their wealth due to time restrictions.
There also factors outside of your personal life events that would trigger an estate review.
- Economic changes – Inflation rates, which we’ve seen drastically adjust, can affect the outcome of your estate plan. Tax rates of course have an effect as much of estate planning is centered around tax management.
- Federal and state law – State law can affect inheritance and estate taxes, determine probate, intestacy laws, etc. There are many ways law can influence the outcome of a plan. It is crucial for clients to consult with their estate attorney in light of any law changes to ensure their plan is exercised in the manner in which they initially selected.
The above listed scenarios should always trigger a review of your estate planning. However, it is still a best practice to have your estate plan reviewed every 3-5 years. Life changes, it ebbs and flows. Your will should change with your life.