You may think your estate plan is all set, but it might not be, especially if things have changed over the years. If you met with your attorney long ago when your children were young, and now your children are grown and have kids of their own, your estate could actually be a disaster just waiting to happen, says a recent article “Today’s Business: Your estate plan—what could go wrong?” from the New Haven Register.
Most estate planning attorneys encourage their clients to revisit their estate plan every three to five years—and with good reason: the size of your estate may have changed, you may have experienced a health issue, or you may have a new child or a grandchild. There could also be changes in tax law or updated statutes that could throw a wrench in the estate plan you had previously established.
Many people say they “have nothing” and their estate is “simple.” They might also think “my spouse will get everything anyway.” But, this is wrong 99% of the time. There are serious, unintended consequences of not having a will: accounts long forgotten, an untimely death of a joint owner, or a 40-year-old car with a higher value than anyone ever expected.
Your last will and testament designates who receives your assets and provides for any minors. A will can also help protect your wishes from a challenge by unwanted heirs after your passing.
The federal estate tax exemption today is $12.6 million, but if your will was created to minimize estate taxes when the exemption was $675,000, there may be unnecessary provisions in your plan. Heirs may be forced to set up inherited trusts or even sub-trusts. With today’s current exemption level, your plan may include trusts that no longer serve any purpose other than to complicate things for your loved ones.
When was the last time you reviewed your will to see whether you still want the same people listed to serve as guardians for minor children, executors, or trustees? If those people are no longer in your family, or if the named person is now your ex, or if they’ve died, you now have an ineffective estate plan.
Many adults believe they are too young to need an estate plan, or they’ve set up all of their assets to be owned jointly and, therefore, don’t need an estate plan. If one of the joint owners suffers a disability and is receiving government benefits, an inheritance could put all of their benefits at risk. Minor children might inherit your estate. However, since the law does not permit minors to inherit assets, someone must be named to serve as their guardian. If you don’t name someone, the court will, and it may very well not be the person you would choose.
What about using a template from an online website? With increasing frequency, estate planning attorneys are called upon to set things right with botched online “do-it-yourself” wills. The terms of a will are governed by state law and often these websites don’t explain how the document must be aligned with the statutes of the state where it is signed. Simply put, estate plans are not one-size-fits-all documents and a will deemed invalid by the court is the same as if there were no will at all.
If you don’t have an estate plan, if your estate plan is outdated, or if your estate plan was created using an online solution, your heirs may inherit a legal quagmire. Don’t let your estate plan be a disaster. Give yourself and your loved ones the peace of mind of knowing you’ve done the right thing and have your will updated and approved by your experienced estate planning attorney in Davie, Florida.
Reference: New Haven Register (Oct. 29, 2022) “Today’s Business: Your estate plan—what could go wrong?”