One of the reasons people often delay getting their estate planning done is because they know things are going to change and they don’t want to have to go through the process again later. This may be for financial reasons, or perhaps they think the whole estate planning process will be stressful. A good estate planning attorney makes this process easy and painless for their client. Estate planning can feel big and overwhelming, but it doesn’t have to be when you partner with a good advocate. Today we are looking at what happens when a significant changes happens in your finances or life. What are you options? Do you need to make updates to your estate plan? What types of changes are best?

Financial Changes

If you’ve experienced a financial change you may wonder if you need to update your estate plan. In this case, we’re going to assume your finances have improved and you now own more assets. If you have a Will it handles everything you personally own at the time of your death. So, if your Will says “everything goes to my spouse at my death”, everything will go to your spouse at your death. No changes are needed. Now, if your Will disburses specific property or amounts of funds and those items need to be changed, then you need to update your Will. If you have a Trust, it likely has similar mechanisms for cash and most personal property. But if you purchase new real estate or other items that have deeds or titles, you need to be sure those items state that the Trust owns them, so that at your death they can be disbursed under the rules of your Trust agreement.

Codicils

A Codicil is the name for the legal document that makes a change to a portion of your Will. If you only need to change one or two sections of your Will, a Codicil may be the choice for you. However, I typically prefer to do a whole new Will since the Codicil has to be signed by two witnesses and notarized the same as your Will. The other reason for this is that everything is still in one document. There is less likelihood of the Will getting split up than the Will and Codicil being separated.

Trust Amendments and Restatements

Much like a Codicil, a Trust Amendment can make changes to your Living Trust (Irrevocable Trusts cannot be amended or changed). If a change needs to be made during your lifetime, you can do this. You are exercising your right as trustmaker and trustee to amend and restate the Trust— putting into place the changes that are appropriate. The same signing rules apply to your Trust Amendment or Restatement as to the original Trust agreement.

Other Reasons to Make Changes to your Estate Plan

If a key person in your estate plan becomes permanently incapacitated, passes away, or your relationship changes you should update your plan to reflect these changes. When people name powers of attorneys, trustees, executors, and other fiduciaries to act on their behalf they make these choices assuming these individuals or entities are available to do so. If you happen to outlive your trustee and successor trustee selections, now your loved ones must petition the court to have someone named as trustee. The whole purpose of doing estate planning, especially using a Trust, was to avoid going to court for anything. In the same vein, if you named a romantic partner to serve as executor of your Will and you’ve since broken up, you likely would not want that person serving as your executor. The same thing applies if they are named a beneficiary. When major shifts happen in relationships— be they deaths, births, marriages, or breakups— shifts also need to happen in your estate planning documents.

Next Steps

If you already have an established estate plan, but have experienced growth or changes in your life and want to know if changes are needed to the plan, please call me! Likewise, if you’ve been putting off doing your estate planning because you want to wait until everything is set, give me a call! Everything changes. We experience growth constantly. I can help you craft an estate plan that considers and plans for future changes and won’t require updating every time you get a raise. Call us at (404) 736-6066 to schedule a consultation.