This is a common New Year's Resolution.
Getting your estate plan reviewed sooner rather than later will give you great peace of mind.
Are you looking for some practical steps to break the inertia?
If yes, then a recent Dairy Herd article titled "Legal: Review and update your estate plan now" is rather timely.
The article first recommends that you have fundamental estate planning documents in place, to include a will, a general durable power of attorney, an advance health care directive (a health care treatment directive + a medical durable power of attorney) and, perhaps, a revocable living trust.
Once you have those legal documents in place, however, you cannot stop there.
Well, situations change and life happens.
Consequently, you need to consider updating your documents to reflect marriages, arrival of minor children by birth or adoption, divorces, deaths and more.
You get the picture.
Taking the time to prepare and then update these documents now can help avoid fighting and stress for loved ones left behind later on.
Here are some practical pointers to ponder from the original article:
Create a "Death File."
One of my clients refers to his steps-to-take-when-I-die-file as his "Ted is Dead" file.
After you have your basic estate planning documents in place, gather them in one place and inform at least two responsible people of the file's existence and location.
For example, the file can be placed in a home safe, a bank deposit box or with an attorney.
The persons named in your legal documents as agents, attorneys in fact, personal representatives/executors and trustees also should know the location of these instructions and your original legal documents ... not to mention the ability to access them when needed.
Review Documents for Updates.
As mentioned above, your legal documents should be reviewed periodically to see if any changes are needed.
Also, when you review a will or a trust, identify whether any of the property listed has been sold, transferred, or purchased. If it has, update the documents to reflect the change in ownership.
Check and Update Beneficiary Designations.
Not all property passes in the estate by a will. Some assets, like a 401(K) or life insurance, are passed to the beneficiary of the account independent of a will. This applies to pensions, transfer on death accounts, and accounts held as joint tenants with right of survivorship, too.
Look at Potential Estate Tax Liability.
The federal estate tax exemption for 2016 is $5.45 million per person and $10.9 million per couple.
To determine if such tax liability may be an issue for your estate, the estimated fair market value of assets needs to be calculated. An experienced attorney will be able to discuss options to avoid the federal estate tax—a whopping 40% on any amount over the $5.45 million exemption.
Talk to an estate planning attorney if your estate may be close to the exemption limit.
As the original article notes, a comprehensive and up-to-date estate plan will help ensure that your intentions are carried out and can minimize (or eliminate) potential headaches among survivors.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Dairy Herd (February 9, 2016) "Legal: Review and update your estate plan now"