A comprehensive estate plan can accomplish numerous important goals. Along with ensuring that your assets are distributed according to your wishes after your death, your plan can also help you achieve a wide range of additional, related goals. For you to achieve the maximum benefit from your estate plan, however, it must be reviewed and revised on a regular basis. To help you better understand the importance of this, a Beverly estate planning attorney at DeBruyckere Law Offices discusses what can happen if you forget to update your estate plan.
Why Do I Need an Estate Plan in the First Place?
Even a basic estate plan ensures that your estate assets are distributed according to your wishes after you are gone and prevents the state from deciding what happens to those assets. It also allows you to decide who will oversee the probate of your estate. Your estate plan can accomplish much more though. A more elaborate plan can also help protect and grow your estate assets. Moreover, it can help with things such as ensuring that someone of your choosing makes healthcare and personal decisions for you if you become incapacitated as well as letting you appoint someone to take over control of your assets during a period of incapacity. You may also have a trust in your estate plan that protects a minor child’s inheritance or that safeguards assets meant for a child with special needs. The benefits of a comprehensive estate plan are numerous; however, your plan’s value can decrease significantly if you fail to update the plan when necessary.
What Happens If I Don’t Update My Estate Plan?
To ensure that your estate plan works as intended, that plan needs to be updated as a matter of routine. In addition, certain life events call for a more immediate update to your plan. To illustrate the need to update your plan, consider what can happen if you forget to update your plan after certain events:
- Marriage – if you recently married, you want to include your new spouse in your plan. If you don’t, and something happens to you, your spouse may not be entitled to inherit from your estate. Worse still, if you become seriously ill, your spouse won’t be entitled to have a say in your treatment.
- Divorce — you probably don’t want your now ex-spouse to be the beneficiary of your life insurance policy (unless it is as the Trustee for your minor children) nor do you want him/her to inherit your estate assets. Worst still, imagine failing to update an advance directive that appoints your spouse as your Agent for making health care decisions for you in the event of your incapacity?
- Death of a fiduciary – throughout your plan you have appointed people to fiduciary positions, such as Executor or Trustee. If one of these fiduciaries passes away, a void is left behind. If your existing plan doesn’t address the void, a court will have to do so. Consequently, someone you would not want could end up administering your estate or a trust you created.
- Retirement – as you get older, the need to update your estate plan is heightened for several reasons. One of the most important reasons is long-term care planning. Unless you can afford to pay for LTC out of pocket, you may need to qualify for Medicaid. To do so, however, the value of your countable resources must not exceed the program limit. Moreover, assets transfers within five years of applying can complicated eligibility. This is one of the many reasons why you need to sit down and review your estate plan before you reach your retirement years.
Contact a Beverly Estate Planning Attorney
For more information, please join us for an upcoming FREE seminar. If you need to review and revise your current estate plan, contact a Beverly estate planning attorney at DeBruyckere Law Offices by calling (603) 894-4141 or (978) 969-0331 to schedule an appointment.