As
I speak with attorneys about estate planning there are two common
issues in our conversations. First, only 25% of all people have a
will or trust. Secondly, of those that complete a will or trust, very
few keep them up-to-date. No matter how thoroughly it is prepared,
your will or trust is a living document that needs attention on a
regular basis after it is completed. Your life and circumstances change
over time and your estate plans should reflect those changes. Some
of the things that can bring change are as follows.
1) People Change. Your relationships with people named in your will
may have changed over the years. New people enter lives through
births, adoptions and marriages. Others included in your plan may
not be active in your life due to death or divorce. Has anything
changed in the lives of the people named in your will (heirs, representatives,
guardians, trustees, or executors) due to death, mental incapacities,
a handicap or serious injury, health problems or relationships?
2)
Assets Change. Since the execution of your will: Has your estate
experienced a substantial increase or decrease in value? Has there
been a significant change in income or wealth of either the person
making the will or a beneficiary? Has there been a change in business
ventures either positive or negative? Have you added or dropped
life insurance since your last review?
3)
Places Change. Have you have moved out of the state in which you
executed your will? You should consult an attorney in your new location
to determine whether it is still valid. State laws regarding the
execution of wills vary.
4)
Laws Change. Tax laws are constantly changing both on the state
and federal levels. Consult your attorney.
5)
Time Changes All. If you haven’t reviewed your will in the last
three years or more, it is time for a review. The best course of
action is to return to your original will, review it and make certain
that it’s been updated according to your changing needs. An even
wiser practice is to do it annually. You should be aware of the
age at which you are required to begin taking distributions from
your IRA, 401(k), or other qualified plan. Generally, you can begin
taking from your plan at 70.5 years old.
Wills
are valuable tools that make possible a smooth transfer of your assets
to heirs and charities upon your death. Your will should be reviewed
and given regular check ups throughout life and certainly when any
major changes have taken place.
Nick
Davis serves as Regional Vice President – East for the Missouri Baptist
Foundation. Contact Nick at ndavis@mbfn.org.
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