Over my 36-year career, I have found the biggest mistake people make is failing to continually review and update their estate plan
– Matt Dana, Founder
Most clients go too long without reviewing or giving additional thought to their estate plan. We recommend a review every year at best and at least a review every time there is a significant event in your life at worst case.
Is your Trust in a “Rip Current?”
At Lifeguard Law we find that the best clients are the ones that already have a trust. At one point in time, they understood all of the benefits. But, time has a way of slipping by for most of us. We wake up one day and realize that our Trust is in a “rip current” for one or more of the reasons listed below and needs to be rescued.
Estate Planning is a work in process, not a “One and Done”
An Estate Plan should be reviewed at least once a year. In addition, you may have questions throughout the year that can’t wait until an annual meeting. Estate Planning is a work in process.
Change in the law
Whenever there is a major change in the law, including changes in State laws that impact Wills and Trusts and changes in Federal Tax Laws. It seems like we get a major tax law change every time we have a shift in power in Washington. The Estate Tax Exemption is constantly changing, and with every change the Trust needs to be reviewed.
Obviously every time there is a death in the family the Estate Plan needs to be looked at. When one spouse dies it is imperative for the surviving spouse to look at the trust to see if it is still efficient. If a child dies, what do you want to do with that share?
New to Arizona
Trusts are created and governed by State law, not Federal. Each State is very different especially community property States versus non-community property States. Arizona is a community property State. Chances are you moved from a State that is not community property. Plus Powers of Attorneys and Wills are governed by State law and should be reviewed every time you change your legal residence.
Were your documents created online without the assistance of a lawyer? So often whatever documents were created online don’t address the specific needs of the individual. Estate Planning is not a one size fits all situation. Also, it’s important for you to establish a relationship with a Trust and Estates lawyer who you know will be there for your loved ones when needed.
Change in your Financial Situation
A change in financial circumstances has a huge impact on the tax clauses that you need or don’t need inside of your Revocable Trust. If one spouse receives an inheritance thought needs to be given as to whether or not to keep it sole and separate or to make it community property.
When clients divorce, the Estate Plan needs to be terminated and two new Estate Plans need to be created. The Estate Plan is revoked as to provisions for each spouse, but still valid as to the rest of the document. Chances are you want to start all over and create a new plan.
Changes in Relationships
My wife and I have 5 kids and 18 grandkids. At any one time, someone is mad at us for whatever reason. Plus, as my kids age and I see the financial mistakes they continue to make it leads us to modify the distribution provisions in our trust to older ages.