When Cherry Hill residents create their estate plans, it is often assumed that further changes are unnecessary. But as the years go by, it can be easy to forget exactly what the original documents contain. Major changes such as marital status, childbirth and death can affect estate planning, requiring proper adjustments to avoid future problems with probate.
Reviewing an estate plan is essential as life situations change, and a recent article notes five important steps for updating estate planning documents:
- completing a review of all paperwork
- determining one's family situation
- assessing the need for trusts and sub-trusts
- updating the schedule of assets
- accounting for the current estate tax laws
One aspect of an estate plan review involves the beneficiaries of a trust. For example, when a family is younger, a trust may be created to benefit the children in the case of a parent's death. However, as the children age, a person completing an estate plan review may decide that the children no longer have a need to inherit large funds. In these situations, it might be wise to consider a generation-skipping trust that can benefit grandchildren.
Additionally, assets can change as a person ages. It is not uncommon for Camden County residents to acquire property and other assets over time. In these cases, it may be necessary to add the newly acquired property to an existing trust.
The tax laws affecting estate planning are also subject to legislative change. For example, the estate tax exemption is currently set at $5 million. However, the exemption is scheduled to be reduced to $1 million after this year.
The review of estate planning documents can be done on a regular basis or when life situations change. Each of the documents in a plan requires a complete reading. Also, it is wise to research any changes in estate planning legislation as you work to protect assets for yourself and your loved ones.
Source: LifeHealthPro, "5 Important Steps to Update Estate Plans," Michael S. Fischer, April 9, 2012