Don’t Let Outdated Estate Planning Documents Haunt You

Our lives are constantly changing. If you’ve gotten married or divorced, welcomed a child, lost a loved one, moved to a different state, bought a new home, opened a new account, or it’s simply been a few years since you updated your estate plan, dust the cobwebs off your estate planning documents and confirm they are still accomplishing your goals. I have created two free estate plan review checklists to help you review your plan and spot issues that may require an update.

If you have a will-based plan, download my Review Checklist for Wills, and if you have a revocable trust-based plan, download my Review Checklist for Revocable Trusts.  

If You Have a Will

Read your will to confirm that your primary and contingent beneficiaries still match your wishes. Verify your executor and alternates are willing and able to serve, and ensure you have directed any gifts to minors or vulnerable beneficiaries to trusts for their benefit, rather than making an outright distribution. If you have minor beneficiaries, check in with their nominated guardians and alternates to confirm they’re still willing to serve.

A will controls only your probate assets. Non-probate assets, such as life insurance policies, retirement accounts, and POD/TOD accounts, pass according to the beneficiary designation forms on file. Check all beneficiary designations on retirement accounts, life insurance, annuities, and any POD/TOD accounts to ensure you have listed primary and contingent beneficiaries. These assets pass outside your will, which makes coordinating your beneficiary designations important. Review every beneficiary form separately to ensure you have listed the correct primary and contingent beneficiaries. 

If You Have a Revocable Trust

Creating a revocable living trust does not avoid probate unless you fund it. Funding means titling appropriate assets in the name of your trust and coordinating beneficiary designations so they work with your plan.

If you haven’t conveyed your real estate to your trust, it will have to go through probate, which you likely established your trust to avoid. Make sure you record a deed transferring title to your trustees using clear vesting language, for example, “John and Mary Smith, as Co-Trustees of the Smith Family Revocable Trust dated June 1, 2022, and any amendments.” Double-check the title after you refinance your home to make sure it is in your trust. If you own property in another state, transfer it to your trust to avoid ancillary probate.

You cannot retitle your retirement accounts to a trust during life. Instead, confirm that your beneficiary designations are consistent with the beneficiary instructions your attorney provided when you established your trust. For life insurance and many annuities, naming the trust as the beneficiary can ensure the proceeds pass according to the terms of your trust. 

If you have kept a small checking account in your own name, make sure you have a pay-on-death designation on file directing the account to your trust or heirs. Larger savings and brokerage accounts typically should be titled in the trust so your successor trustee can act if you become incapacitated and so those accounts transfer without probate after you die.

Check In with Your Fiduciaries

Review your durable power of attorney and your medical power of attorney to confirm your agents and alternates are still the people you trust and that their contact information is current. Make sure you also have a HIPAA authorization so your health care agent can access medical information. Let your fiduciaries know where your documents are stored and how to access them. Then put a reminder on your calendar to check in again next fall. Small, steady updates keep your plan working the way you intended.

Estate planning is not a once-and-done event. It is an ongoing process that needs to adapt not only to changes in your life but also to changes in the law. If more than three years have elapsed since we completed your plan, download the free estate plan review checklist and schedule a Peace of Mind Review to ensure outdated documents don’t cause avoidable stress, expense, or unintended results for your loved ones.