Congratulations, you have a shiny new trust. There is definitely a sense of relief to have that done and accomplished, knowing that the people you care about are going to be protected, and prepared. Here are five things that you, and not your attorney, need to do going forward after completing your estate plan.
1. Keep the right things under the trusts “umbrella”
Your attorney should have carefully gone over your assets with you in initially funding the trust (if he or she didn’t, you might have gone to the wrong place). Of course, that list of assets will change over time. It is important to know what goes into your trust, and also, what does not go into your trust. If you have questions about whether any particular asset should be held by the trust, you should double check with your attorney.
2. Implement your incapacity plan
Your Health Care Directive and Durable Power of Attorney are designed to protect you in the event that you become incapacitated, or need assistance managing your medical and financial affairs. To maximize their effectiveness, however, you shouldn’t just leave copies in your binder. Take copies of your Durable Power of Attorney down to the bank, so that the bank has it on file when the need arises. Give your doctor a copy of your Advance Health Care Directive. Consider giving your agent a copy of the documents as well. If you’re uncomfortable with that, at least make sure the agent knows where to find them, and can get to them if they need the documents. They won’t do any good if no one knows where they are, or can’t get to them because they’re inaccessible in a bank vault.
3. Adapt and overcome change
The good news is that typically your trust and estate plan can change. The bad news is that when your circumstances change, or there are changes in the law, your plan stays the same until you actually change it. At our office, we give our clients a free review of their plan every three years to make sure their plan stays current.
4. Communicate the essentials
Depending on your comfort level on discussing these things with your children or your beneficiaries, this may be easy, or not so easy. Generally speaking, the more details the successor trustee and beneficiaries know, the easier things will go. Amounts aren’t so important, but what is important are the location of accounts, and the key people you trust to handle your financial life – your tax preparer, your insurance agent, your financial advisor, etc.
5. Guard the physical documents
This may seem obvious, but I’ve worked with a few clients who were sure they created a living trust, but couldn’t find it. We had to create an entirely new set of documents for them. Other problems arise when the successor trustee or beneficiaries don’t’ know where to find the trust documents. An entirely different problem can arise when someone who shouldn’t, has access to the estate planning documents. Make sure the successor trustee knows where the documents are, and as a backup, knows who prepared the documents for you.