One of the biggest misconceptions people have about estate planning is that once they complete the initial set-up, their job is done. The reality is that you and your attorney should review your estate plan each year to see if anything needs to be changed. A lot can happen in a year, and the best time to review your estate and make changes is right after the New Year when everyone hits the reset button on their lives.
Did you make a lot of money last year? Have you acquired a lot of new property in the last 12 months? Has your marital situation changed and now you feel like a trust is the best way to protect your assets and make sure they are distributed properly after you have passed? A year is a long time, and the beginning of the New Year is the best time to review the changes in your life over the past year and decide if now is the time when a trust would best serve your needs.
Your life can change a lot throughout the course of a year, and so can the lives of your estate beneficiaries. If you had a beneficiary pass away in the past 12 months, then you will need to make the proper changes to your estate. If you had a falling-out with one of your beneficiaries, then now may be the time to determine if they should remain a part of your estate.
On the other hand, you may have created the need to add beneficiaries to your estate to protect those you love. If you had any new children or grandchildren in the past year, then it is time to revise your estate and make sure that everyone is taken care of.
If you already have a trust and you have added property in the last year, then the New Year is a great time to update your estate inventory and make sure that everything is accounted for. A trust will allow you to avoid probate, but items not included in your trust could be exposed to probate if you pass away without updating your trust. Each year, it never hurts to update your estate inventory and make sure that your final wishes for all of your property are taken care of.
Your estate planning includes instructions on how you want your money allocated after you pass away. If you became very active in a charity over the past year, then you may want to readjust your estate to make sure that charity is taken care of after you are gone. You may even want to add a small life insurance policy and make the charity the beneficiary.
An estate that is not regularly updated can be a very dangerous thing. Your feelings on your property and the people in your life can change in 12 months, and your estate needs to reflect those changes. At the beginning of each year, you should make an appointment with your estate attorney to go over the structure of your estate and make any changes that may have become necessary in the last year.