It is tempting to think of your estate plan as a “set and forget” document because estate planning attorneys work very hard at covering all kinds of alternate scenarios. The reality is that like any plans, circumstances may change – new laws may be written, new approaches may be developed, and new family dynamics may arise. These five simple questions are a quick “self-diagnostic” on whether it is time to have your living trust looked at.
1. Who prepared it?
Did you work with a qualified estate planning attorney? Have they kept in touch with you and helped you keep your plan up to date? Trusts are like anything else made by people – quality can vary dramatically, and while you may not know the difference, your loved ones certainly will.
2. When was it prepared or last amended?
If it’s been over three years, it is probably time to at least have it looked at. There have been some pretty dramatic changes in the law over the last five to ten years that could make a big difference in how your estate plan should operate.
3. What is in it?
Are your real estate and bank accounts titled in the Trust? An unfunded trust is like a car with no gas – it is not ready to work. Your house and bank accounts need to be titled in the trust, and other assets need to be correctly dealt with. If you leave things out, they could be exposed to probate, and if you put the wrong things in your trust, you could create a mess. Make sure you understand from your attorney what should be in the trust, and that those assets have been correctly changed over to the trust.
4. Where do you keep it?
Do you have a safe place for your estate planning papers? And have you communicated that to your successor trustee? I understand that an estate plan can be very sensitive, and not something you want to discuss. There are tactful ways to discuss what is important, without necessarily divulging confidential information. It is important that you know where your trust documents are, and that your successor trustee knows where they are as well. If possible, they should have a copy of the documents as well.
5. Does anything need to be changed?
Have there been any major life changes since creating the documents? Life happens, and what made sense when you created your estate plan when your children were little, might not make sense now. It’s important to review your documents regularly to make sure that the people you want to be in charge of important family decisions are the ones actually nominated in your plan.
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