Do You Need to Update Your Estate Planning Documents?

Posted August 30, 2018

It’s important to be prepared for whatever the future might hold. This is one of the reasons why some people are drawn to a continuing care retirement community (CCRC, or “life plan community”), which offers access to a full continuum of care services that may be needed in the future. Preparing for life’s “what ifs” also includes creating and maintaining up-to-date estate planning documents.

The Must-Have Planning Documents

Here are a few of the most important documents that you should ensure you have created:

A Will or Trust

A will provides direction on how your money and property should be distributed when you die. Under a will, the distribution of your assets must go through a legal process called probate, which validates the authenticity of the will, inventories and appraises the associated property, pays out any debts and/or taxes, and finally, distributes the remaining assets based on the directions within the will.

In many ways, a trust has a lot in common with a will—providing direction on how you want your estate to be distributed after you pass—but a trust also provides guidance on managing of your assets should you experience any periods of incapacity during your lifetime. When you die, a trust typically circumvents the probate process, making your assets available to your beneficiaries more quickly. 

Power of Attorney

Power of attorney is assigned by a “principal” (you) to an “attorney-in-fact,” also known as an “agent” or “proxy,” giving that person legal authority to make decisions should you become mentally or physically incapacitated. The attorney-in-fact can be a spouse/partner, adult child, relative, or friend, but most important: It should be someone you trust to act in your best interest with all the decisions they make on your behalf.

Advance Directives Documents (Living Will)

Should you become terminally ill, seriously injured, in a coma, in the final stages of dementia, or near the end of your life, advance directives provide written guidance to help steer the care choices made by healthcare providers and other caregivers. Typically, the more specific you are with your wishes, the better.

Reasons to Review Your Estate Planning Documents

There are of course other important planning documents that you may have, such as a life insurance policy, a 401(k), or IRA. While it is wonderful to have taken the steps necessary to create these planning documents, there’s another task that should not be overlooked: maintenance—periodic review of the terms you have set forth within your documents, including beneficiaries and designees.

Some people will advise you to do an annual review of your plans for your estate, and this is sound guidance, however, there are several other milestones and events that also should trigger a review of these legal documents:

  • A marriage or divorce: Whether it is a change in your own marital status or that of one of your beneficiaries or designees, it might be cause for an amendment to your estate documents.
  • A birth: A new baby—whether a child or grandchild—is not only a reason to celebrate, it is also potentially a reason to update your beneficiaries.
  • A major health event: Receiving a serious diagnosis can be frightening, but it may also be a stimulus to take a look at your estate plan, especially your power-of-attorney and advance directives documents.
  • Addiction: It has a heart-wrenching impact on so many families in our country. If you have a loved one dealing with addiction, it may necessitate you reconsider some of your estate planning decisions.
  • A substantial change in your financial situation: Whether you win the lottery or suffer a major financial setback of some type, it should be the impetus for a review of and potential amendments to your documents.
  • Tax law changes: It may seem like changes to the tax laws are being implemented almost constantly. It’s wise to talk with a tax expert periodically to understand how these changes may impact your estate and your beneficiaries.
  • A move: This is an important but often overlooked milestone when it comes to estate planning. Moving to another city or state can impact the probate laws applied to your estate and the tax implications for your heirs. States also have different laws about powers of attorney and living wills, so it is important to review all of your planning documents if you move. Additionally, if you decide to move into a CCRC, it is important to take into account the impact a refundable entry fee can have on your estate.

A Plan for Your Future

While no one can be certain what tomorrow will hold, you can take control of your future by creating several important legal planning documents including a will or trust, a power of attorney, and a living will. However, once you have created your documents, it is crucial that you review them on a regular basis—or when you experience one of the milestones above—to ensure they still reflect your wishes.

Closer to Home

It's important to plan for the future no matter where you see yourself. Protect yourself and your family with updated documents along with the security of wonderful living and gracious aging. At Falcons Landing, residents take the extra step to ensure their future is exactly what they envision with our continuum of care. We welcome you to learn more about our continuum of care which meets you wherever you are on life's journey.


The above article is provided by myLifeSite and is legally licensed for use.

↓ Scroll