Having an older Trust or Estate Plan is not, technically, a problem. The age of the Trust is insignificant. However, whenever I see one that is a few years – or decades – old, I almost always see changes that affect the final plans the person had originally intended.
Recent tax law changes also allow me to make many older trusts simpler and easier to use. If you have a trust older than 2010 than has not been reviewed since, now is a good time for a check-up.
Here are 5 things to consider about your older Trust or Estate Plan:
Are your Asset Schedules up to date? Any Estate Plan or Trust that is more than a few years old almost always has an out-of-date Asset Schedule. Did you buy or sell real estate? Receive an inheritance? Cash out or purchase stocks or other investments? Life Insurance? Retirement accounts? This is an easy fix you can do yourself!
Do you still know, like and trust the people you have appointed to be in charge of your estate? Is your ex-spouse still listed as your Trustee or Executor? Are your trustees still alive and able to act? Are your children now capable adults able to replace other people you may have appointed? These are usually excellent reasons to update your Trust!
Do you still like your beneficiaries? Things change, people change, relationships change. Make sure the people you’ve listed as your beneficiaries are still on your good side. Do you still want to leave your family’s Lake Tahoe home to your EX-spouse? Or your grandmother’s jewelry to your drug-addicted daughter? Are you sure you still want to leave your record collection to your bestie-turned-enemy? Take some time to review your relationships and make sure your original wishes still make sense for your current situation.
Are there dead people included in your will or living people left out? Just like in numbers two and three above – take a moment to review who in your Trust or Estate Plan is no longer with us – and who you may want to add (grandchildren, adopted children, new friends, in-laws, etc.).
Do you have an “AB” trust? Let me be clear here: STAY AWAY FROM “AB” TRUSTS without a property analysis. While “AB” Trusts used to be standard, because of changes in the estate tax laws, they are no longer relevant for most families. If your trust was created by someone who is not an attorney (document preparers, paralegals, online legal services, etc.) double check your trust. Most non-attorneys use “AB” trusts because it’s the only Trust they know how to do. Having an “AB” Trust can often be much worse than a simple trust under current laws. AB trusts are now primarily used for blended families, so that after your spouse dies you can’t disinherit his kids! If you have an AB trust, have an attorney look at it immediately!
You want to make sure that the plan you intended is properly carried out upon your death- that’s the whole purpose of an Estate Plan, after all! Therefore, it’s critical that you have the best possible trustees or executors, that you name the right beneficiaries, and that you have the right kind of living trust.
I urge you to take out your Will or Trust right now and check it for these 5 things. If you need help please feel free to give us a call at 925-757-4605 or contact us by email. I’d be happy to review your estate plan with you.
~Joel Harris State Bar Certified Specialist: Estate Planning, Trust and Probate Law