5 Reasons Your Trust Might Be a Fixer-Upper?

Even the most well-built homes need some TLC from time to time. Periodic maintenance makes sure the home isn't in such condition that it needs to be torn down to start new. This is true as well with plans. Plans need to be changed to meet current circumstances. This is also true of your estate plan. If it has been a while since you have looked at your trust, it may be time to dust that document off to see if there is some simple TLC that you can give that plan to make it work for current circumstances or whether you need a complete tear down to build the plan fresh.

Take a look at the signing date of your trust or will, now see if any of the following circumstances apply to you.

Change in Marital status: Have you gotten married, divorced, did a spouse pass away, or are you remarried. These are all reasons that make it vital for you to seek out the help of a professional. Less often thought of might be the marital status of your beneficiaries. This may also effect your plan. I actually had a certain couple that came in because their daughter was recently married and they... did not get along (let's keep it to that). They wrote a plan that made sure that their daughter and maybe future grandchildren would inherit, but not the new spouse.

New Arrivals: In the form of babies. Yes, if you or your beneficiaries have had children, you may need to update your plan or at least check with your estate planning attorney. Typically, I try to make my plans flexible and foresee the possibility of future children, but not all plans are constructed this way. Maybe you don't have new children, but your children have simply grown up and the plan that you were making to protect them, now needs to be changed to a plan where your children are in charge.

Tax laws have changed: Times have changed and so have taxes. If your plan has not been reviewed by a professional since 2013, you may need to change the structure of your trust. Plans for married couples written before 2013 were often designed to avoid estate taxes. Now we are in a tax climate where inheritance tax is less important, but capital gains tax avoidance is more important. Again, I typically create flexible plans that will work in either tax climate, but many plans were not created with this type of flexibility and need to be reviewed by a professional.

You Want a Different Trustee: This could be because of the scenario I described before: your children have grown and now you want them to be in charge instead of your brother or sister, for instance. This could also apply, however, in a situation where you named a good friend or neighbor to take the job and you just don't have the same relationship with that person any more.

You Won the Lotto: Or... your assets have significantly changed in other ways. Maybe you put together your estate plan a decade ago and have since made wise investment decisions and now your assets have doubled. Maybe the character of your assets have changed. These are all good reasons for you to review your estate plan with a professional.

Give Us a Call

We would love to be the professional who reviews your estate plan with you. Just call us at (951)304-3431.