Here’s an easy resolution for the New Year: check your estate plan.
Let’s say you are young and healthy, busy with kids or building your career. You don’t have millions in the bank, but you do have a lot on your shoulders. Your estate plan is about helping your loved ones move forward if something tragic happens to you.
Reviewing your plan each year helps keep it up to date. Here are a few places to start:
- Your Will. Your Will is your last turn at the helm. It is the document that lets you appoint a guardian for your kids, and distribute your assets appropriately. Any time you experience a major life event, you ought to review your Will, and it’s smart to just read it over annually in case it needs updating.
- Trusts. Trusts are easy to create, and can make a lot of sense. For example, you might form a trust to serve as your life insurance beneficiary. A trust can specify how certain assets should be used so they are more likely to be there when you (and your family) need them to be.
- Insurance. Your life, disability and other insurance needs may change over time. Perhaps you have too much, not enough, or not the right kind. If you aren’t positive, consider meeting with a reputable insurance advisor. Many offer free consultations, and their insight and analysis can be invaluable.
- Beneficiaries. Some assets (e.g., life insurance and retirement plans) typically pass to beneficiaries you designate on a form – not through your Will. Your beneficiary designations don’t update themselves. Check them periodically and thoroughly, especially after any major life event.
- Advance Health Care Directive and Durable Power of Attorney. These documents – generally easy to set up or amend – are intended to help your family carry out your wishes if you become incapacitated.
- The Tax Code. Some estates have very complex tax planning considerations – far beyond the scope of this article. But regardless of the size of your estate, it makes sense each year to learn about any tax law changes that might impact your situation – preferably with the help of a qualified tax advisor.
Estate planning is easy to put off, but important to do. Once you have an overall plan in place, a quick check each year can help keep things up to date.
Please note that this is a general overview, meant for informational purposes only, and it is not an exhaustive list. Every situation is unique. Always speak with an attorney or other qualified professional before implementing an estate plan. Casco Bay Law, LLC, does not offer insurance products or guidance; always consult a qualified insurance professional before buying insurance.