Reviewing Estate Plans on an Annual Basis

DuPage County estate planning lawyers, estate plan updates, financial advisors, future financial plans, reviewing estate plans, estate planning documentsThe arrival of the New Year often leads people to examine their decisions and lifestyle choices, as they look back at the year gone by and reflect. Many will make choices to go on diets, begin exercise programs, or make other changes to help ensure a longer, healthier life. The New Year is also a perfect time to look back and examine any events which may have occurred and will affect one’s future financial plans.

Various life events may cause a person to make changes to any estate plans he or she has in place. Hence, financial advisors recommend reviewing these plans on an annual basis—the beginning of the New Year is a great time to review these plans.

Moreover, there are life events which typically necessitate a beneficiary change to certain estate planning documents, such as wills and trusts. These events include:

  • A birth or a death of a beneficiary: If you have another child or grandchild, you may want to redo the division of your estate to include the new child. This is also true if there is a death of a beneficiary. For example, if one of your adult children passes, you may now want to take what would have been his or her share of your estate and have that share go to their children (your grandchildren) in the event of your death.
  • Marriage or divorce: If you get married, you may want to change your estate plans to include your new spouse as a beneficiary. The same holds true if you become divorced. You may want to remove your spouse as beneficiary. These changes need to be specifically implemented to whatever estate planning documents you have. A divorce decree alone does not remove your spouse. For example, one Illinois man who had a life insurance policy of $400,000, had originally named his new spouse as the beneficiary.Eventually, the marriage broke down and the man filled out forms to change the beneficiary to his adult children. However, he failed to file the forms. When he suddenly died, his adult children found the filled out forms among his paperwork, but a court ruled that since the changes were never officially made, the wife was entitled to the $400,000.
  • Moving to a different state: Estate planning laws vary from state to state. Therefore, if you have recently moved, you should investigate what your new home state's law are to determine if you need to make changes to your estate plans.
  • A change in financial status: Another reason to alter estate plans is if you have a change in financial status, such as receiving an inheritance or a lottery win.
  • Changes in the life of a beneficiary: If, when you had your attorney draw up estate plans, your children were minors, then you may want to makes changes since those children are now adults. Another event that may necessitate a review is the marriage of an adult child. If you are concerned what will happen to any inheritance you leave to your child because you are uncomfortable with your child's choice of spouse, you may want to consider setting up that inheritance in a trust which has limitations.

If you would like to review your estate plans in the new year, please contact Stock, Carlson, Flynn & McGrath, LLC. Our experienced DuPage County estate planning lawyers will help ensure that your wishes are carried out with your estate when you are no longer here.