Should You Update Your Estate Plan?
May 25, 2022 - Publication
There are many reasons to update or revise your estate plan. Below is a non-exhaustive list of questions that may be helpful in making that determination.
Questions About You and Your Beneficiaries
- Are there individuals or charities you would like to add or remove as beneficiaries?
- Has your relationship with a beneficiary changed?
- Has a beneficiary died?
- Has a beneficiary married, had children, or gotten divorced?
- Do you have a special needs beneficiary?
- Would any beneficiary who is receiving property outright under your estate plan benefit from having his or her share remain in trust (e.g., because of concerns regarding financial stability, creditors, or divorce, or to minimize a beneficiary’s estate for estate tax purposes)?
- Have you experienced any of the above changes?
- Have you made gifts or loans that affect your estate plan?
- Did you move or acquire another residence/vacation home?
Questions About Fiduciaries
For each trustee, executor/personal representative, agent under a power of attorney, and guardian named in your estate plan:
- Is the individual still living? If an institution, do you still have a relationship with this institution?
- Can you still rely on the individual or institution?
- For individuals: has the individual experienced a change in personal circumstances that causes you to want to replace him or her?
- For each professional fiduciary/institution: have you confirmed that the professional fiduciary or institution is still willing to take on the role? Does the designated institution have any provisions that must be included in your estate plan documents?
- You can find an article discussing considerations when selecting trustees here: https://www.lgclaw.com/insights/considerations-when-selecting-trustees/.
Questions About Your Assets
- Has your personal net worth significantly increased or decreased
- Are there assets that are specifically mentioned in your estate plan that you no longer own?
- Who is/are the titled owner(s) to your assets?
- What assets of yours are subject to rights of survivorship, beneficiary (or transfer on death) designations? Are those rights or designations consistent with your intentions?
- Will there be enough cash or readily convertible assets available to your fiduciaries to pay estate obligations and estate taxes?
- Do you own an interest in a partnership or other closely held business that is subject to transfer restrictions?
- Do you own a life insurance policy that needs to be incorporated into your estate plan?
Periodic Attorney Review
In addition to the above questions, note that legislation, regulations, and court decisions may affect your estate plan. As such, we recommend that you periodically ask an estate planning attorney to review your estate plan to determine if developments in the law require you to update your estate plan. Recent examples of developments that may have affected your estate plan include: the SECURE Act’s changes to the distribution rules for retirement accounts, the TCJA’s temporary changes to the estate tax levels, and changes to the Illinois Trust Code, which sets numerous default rules for trusts that have Illinois situs (exceptions may apply).
If you feel that the time is now to have your estate plan reviewed or updated, please contact us.