Why Estate Planning is a Lifelong Process
It's really no picnic. No one actually enjoys talking about and planning for the end of their life. It can be a depressing exercise, as well as very tedious. Of course, If you think tedium now is hard to deal with, imagine the chaos that awaits your family should you not plan for the end properly.
No one would argue that creating a proper and effective estate plan, including drafting wills and trusts and other instruments and naming people to administer the estate, including trustees, executors and guardians, is fun. Yet, when everything is said and done, and all T's are crossed and I's dotted, the feeling of relief on the part of everyone is palpable.
Too often, people feel relieved because they believe the process is finished. They put the papers away in a safe, assume everything is in place forever and forget about them. Unfortunately, that could be a huge mistake. The reality is, life goes on and circumstances change constantly, which means it's quite possible that a plan that was effective years earlier may not be now.
To be effective, an estate plan must be revisited once in a while, and any changes have to be taken into account. For example, if your estate plan is more than ten years old, you should be aware that the amount that can be passed to heirs tax-free has increased significantly, from $1,500,000 in 2005 to $5,430,000 in 2015. If you have an old estate plan based on the old figure, you could effectively be disinheriting your spouse. This is because many estate plans for married couples set up two trusts; one for the other spouse, and another for other heirs, with instructions to fund the spousal trust first, up to the exemption limit. You could be denying your spouse access to as much as $4 million if you don't update your estate plan.
Another wrinkle can come if you end up moving to Georgia from another state or vice-versa. Different states have different rules, and you may have to change certain details in order to increase or maintain the effectiveness of your estate plan.
Then there are the changes no one wants. What if one of more of your beneficiaries passes away? If you don't modify your estate plan to account for that, you could potentially disinherit some grandchildren altogether.
Your life doesn't stand still, so neither should your estate plan. Since it's difficult to always remember when something triggers a necessary change, one good practice might be to speak to a qualified estate planning attorney every year at the same time for a review.
