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Four reasons to update your estate plan immediately

| Aug 25, 2020 | Estate Planning |

Estate plans are important legal tools that help guide the distribution of your assets. These documents require a review and an occasional update. Common events that trigger the need to review an estate plan include a birth or death in the family, marriage or divorce, and the simple passage of time. A good rule of thumb is to review the document every five years.

Additional reasons to review an estate plan

Although these basic rules remain, the current coronavirus pandemic has resulted in some additional reasons to review an estate plan sooner rather than later. Four examples that are specific to this current situation include:

  • Incapacitation language. Estate plans often include language that governs how an individual is determined incapacitated. If triggered, certain documents can provide a designated individual to help make healthcare and financial decisions on your behalf. It is not uncommon for these documents to require a written statement from a medical professional to determine incapacitation. With the current pandemic, it can be difficult to get in to see a doctor and do so safely. As such, it may be wise to update this provision.
  • Succession provisions. If your estate plan includes a trust, review the trustee designation. Make sure you have at least one, ideally more, back-ups in the event that the named trustee is unable to take on the role.
  • Update health care directives. Health care directives generally allow a named individual the power to help make decisions regarding your healthcare. The type of healthcare you want to receive or the individual you want to serve is this role may have changed. Update the document to reflect these changes and be sure to include back-ups here as well.
  • Bequests. The coronavirus has impacted more than our health, it has also had a serious impact on the market. As such, it may be wise to review bequests. You may want to update the bequests if these gifts are structured with exact amounts. In some situations, grantors may give a set value to charitable organizations with the remainder of their estate distributed amongst their children. If assets have taken a hit, this could mean less is left to go to children than you originally thought.

We are navigating unprecedented times, but we can navigate them together. Review your plan and update as needed to better ensure it is a good reflection of your intentions.