PEACE OF MIND
Creating an estate plan is a huge accomplishment. However, your work is not done when the documents have been signed. You must still ensure that the chosen strategy gives you peace of mind and protects the legacy you have worked so hard to build. An estate plan is not static; it is a living tool that should evolve with the changes in your life. Over time, your family circumstances, financial picture, and estate planning goals will likely shift.
You do not need to spend countless hours worrying about your estate plan. Just ask yourself these eight simple questions to stress test your plan and determine whether it is time for an update.
1. When did you last update your will or living trust or give it a once-over.
In most cases, reviewing an estate plan every three to five years is sufficient, but if a major life change happens sooner, it is a good idea to take another look immediately.
The more time that has passed, the more likely there have also been changes in the law that could affect how your plan works. It is best to have your estate plan professionally reviewed every three to five years.
2. Whom have you named as executor and trustee. Are the people you chose to wind down your affairs still the right fit?
Ask yourself: Is the person I chose still willing and able to handle this responsibility? Am I confident that they understand my values and will act in a way that reflects my wishes?
3. Do you have adequate life insurance. Life insurance is an effective way to provide for yourself (depending on the type of policy) and your loved ones after your death.
It is important to ensure that you have the right kind of insurance and the right amount of coverage for your needs. For each of your policies, regularly review and update your beneficiary designations.
4. Which of your accounts or pieces of real property are jointly owned with someone other than your spouse. Jointly owned property can sometimes cause unexpected tax issues. Look at your real property records and seek advice from a professional to ensure your accounts and property are titled in the most tax-efficient way while still carrying out your planning objectives.
5. How is your recordkeeping.
Good recordkeeping will make your loved ones’ job much easier if they need to step in for you while you are alive but unable to manage your own health or finances, or when the time comes to wind down your affairs after your death.
Do you have an up-todate list of all your bank and investment accounts, employee benefits, retirement plans, online passwords and key legal documents in one safe place? If not, now is a good time to create one.
6. Has your health, or the health of a loved one, changed. If you or someone close to you has been diagnosed with a serious illness, it is important to review your estate plan to ensure that it reflects your current circumstances.
You may want to update your healthcare and financial powers of attorney to ensure that your decisions will be managed by someone you trust who understands your wishes.
7. Have you experienced a major financial change.
Your estate plan should always reflect your current financial picture.
If you have received an inheritance, sold or purchased significant assets or made new investments, reviewing and updating your estate plan is important. Such changes can affect tax exposure, distribution goals, and even beneficiary designations.
8. Do you have a plan for your digital life. In today’s world, so much of our personal and financial life exists online, yet many overlook these assets in their estate plans.
Digital assets include cryptocurrency, online accounts, social media profiles, email, cloud storage, and even monetized platforms or websites.
A thoughtful plan should identify these assets, authorize who can access them, and provide clear instructions on managing or transferring them.
This article is provided as a service of the Law Office of Lasca A. Arnold, PLLC.
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