If You Have Assets, Dependents and Charitable Intent, You Need a Plan
While it is never too early to have a plan drafted, life events can often be the impetus that trigger either drafting a plan or having the plan in place reviewed and updated. There are so many life events that can alter an existing plan that it’s recommended to have at least an annual review. Some other life events may need to be acted upon immediately.
In community property states like Arizona, remarrying can have unwanted effects on your plan. If two people are married after already having children and their own plans drafted, the community property laws assume you did not mean to disinherit your spouse. That could mean half of your estate would go to your spouse instead of to your children as planned in your will. Unless your new spouse is kind enough to forego their portion of the estate or you had a prenuptial agreement in place, he or she will take half. The only way to cure this defect is to have your plan revised after you are married. You can specifically state you intend to leave all of your assets to your children, instead of your spouse. By showing a clear intent you can protect your children and your assets. This is important as well when adult children marry. What happens when your “in laws” become “out laws”? Having a pre-nup—even a post-nup—can avoid nasty arbitration and court showdowns.
Creating or updating an estate plan is not usually the first thing on someone’s mind during a life event, so in order to cover your bases, you should have your plan reviewed annually. Watch the interview with estate planning attorney Elizabeth Westby on keeping your estate plan current as life events occur.
If you ask your attorney who drafted your plan, he or she will usually review your plan at no charge. This is why it is important to choose an attorney who you want a relationship with. This is the person who will be the approved contact your family will rely on when the time comes. Your attorney will know your wishes and help provide guidance at a difficult time in your family’s life. A lot of people try to economize by using online services to draft their plans. While it is possible to create a decent plan online, you’re missing the relationship with an attorney and the opportunity to have your plan reviewed regularly.
Creating a relationship with your estate planning attorney may be the very thing you need when decisions are necessary and you need the dispassionate voice of a trusted third party.
Syndicated financial columnist Steve Savant interviews estate-planning attorney Elizabeth Westby on the basics of estate planning, creating a will and installing appropriate trusts. Right on the Money is a weekly financial talk show for consumers, distributed as video press releases to 280 media outlets nationwide.