Whether you have a Will or a Living Trust, it is important to review your estate plan every five years, or sooner if you have a change in your family or assets. There may be significant changes in the law that would require you to update your documents. For example, in Maryland on October 1, 2010, the Legislature enacted the Maryland General and Limited Power of Attorney Act. As a result, some individuals were now at risk of having their previously prepared durable power of attorney rejected by a bank or financial institution.
Changes in your family are especially important reasons to update your documents. If you have recently married or divorced, your documents should be changed. Healthcare Powers of Attorney and Directives may have your ex-spouse as your decision maker. If you are separated, you should speak with your estate planning attorney to learn about the consequences of dying while separated. Your spouse, unless there is a valid prenuptial agreement, is still entitled to all or a portion of your estate. The marriage of a child beneficiary may make you rethink the distribution plan for his or her share.
Asset protection and special needs planning are additional reasons to review and possibly update your estate plan. Perhaps one of your beneficiaries now has serious creditor issues or is involved in bankruptcy. If you want to ensure that he receives his inheritance or can at least benefit from it, then a Discretionary Trust with a 3rd party trustee be appropriate. Likewise, if a beneficiary has now become disabled and is receiving government assistance, such as SSI or Medicaid, it is extremely important that she receives her share in a special needs trust. It may also be necessary to make sure that your documents cover the potential for a beneficiary becoming disabled as well.
As you can see, it is not only important to review and update your plan periodically, but it also may be a necessity. In fact, our office not only offers our current clients free consultations to review their estate plan, but we also send out a reminder letter every five years. Now is as good a time as any to get started.
- How Often Should I Meet with an Estate Planning Attorney? - January 18, 2018
- Tax Law Changes for 2018 - December 29, 2017
- Dedicated Gardeners & Creative Spaces in Annapolis, MD - May 30, 2017
