A 5 Step New Year's Resolution to Updating Your Estate Plan

December 29, 2012

A 5 Step New Year's Resolution to Updating Your Estate Plan

1. Request a copy of your beneficiary designations. Contact your retirement plan coordinator or your financial institution and request a copy of the beneficiary designation for each of your accounts that permit such a designation. Even if you think you these are complete, just one account without a designated beneficiary can result in a probate proceeding instead of an out of court transfer directly to your beneficiaries. You may also find that the beneficiary designations are out of date, and this will provide an opportunity for you to update.

2. Centralize all of your estate planning documents. Put all of your original estate documents into one safe location. Make sure that the person you have nominated to act as your fiduciary in the event of your incapacity or death knows where to find these documents and will have access to them.

3. Consider putting out of state property into trust. If you own property out of state, a separate ancillary proceeding in that other state will be necessary at your death, if you die owning the property in your own name individually. An effective means to protect and later transfer the property at death, without the need for probate proceeding, is through the use of a trust. You should consult with an attorney before making any property transfer in order to consider any consequences such a transfer will have to your individual circumstances.

4. List your assets. This process can have several benefits. One, when you look at the list of assets as a whole, you may decide you want to reallocate or diversify the assets you own. Second, in the event of your incapacity or death, your nominated fiduciary can use the list as a starting point to know what assets are out there to manage and protect. Remember, assets include not only the more generally thought of assets such as real estate and bank accounts, but also include for examples, insurance policies, private loans with a balance still owed to you, and potential legal claims. Third, you may find that upon review of the actual ownership of the assets, it would be beneficial to change of ownership of an asset, for example, from joint ownership or individual ownership, to ownership by a trust.

5. Read your estate planning documents carefully. Review your Will, Living Trust, Health Care Proxy, Durable Power of Attorney, and Living Will. Be sure that the disposition plan for your assets is still what you want it to be and that the persons you named to act on your behalf are still your top choices for the job. The terms and provisions of your estate plan will become binding on your representative or fiduciary upon your incapacity or death.

Organizing and creating an estate plan can avoid unnecessary family fighting and hurt feelings, promote privacy of your affairs, provide creditor protection, avoid unnecessary probate delays and costs, and may help reduce taxes.

Before taking any steps or making any changes you should always consult with a qualified trusts and estates attorney.

Article provided by Gemma Law Office, P.C.
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