As an experienced estate planning attorney, I recommend scheduling regular checkups for your estate plan. A new year is the perfect time to review your documents, as laws change, personal circumstances evolve, and your estate plan should always reflect your current wishes. Below are some FAQs to guide you through the importance of an estate planning review.
1. Why Do I Need an Estate Planning Checkup?
Answer: Estate planning is not a “set it and forget it” process. Changes in tax laws, shifts in family structures, and adjustments to personal or financial goals can all affect how your estate plan should be structured. A checkup helps you:
- Update important documents like wills, trusts, and health care directives
- Confirm that your beneficiaries and fiduciaries (executor, trustee, or guardian) are still appropriate
- Ensure you’re taking advantage of any new tax benefits
2. How Often Should I Revisit My Estate Plan?
Answer: At a minimum, most estate planning experts recommend reviewing your plan every three to five years. However, certain life events may prompt a more frequent review: Marriage, divorce, or the birth/adoption of a child
- Significant changes in your assets or income
- Inheritance or receipt of substantial gifts
- Relocated to MN from a different state
3. What Changes in Tax Law Should I Be Aware Of?
Answer: Tax laws can shift from year to year, potentially affecting your estate plan. Here are some key points: Federal Estate Tax Thresholds: The amount you can pass to heirs without incurring federal estate taxes may change.
- MN Estate Tax Threshold: Minnesota has an estate tax that can change periodically.
- Gift Tax Exemptions: MN does not have a gift tax; however, the Federal Gift Tax exemptions can change periodically.
4. What Documents Should I Update During a Checkup?
Answer: A thorough review usually includes:
- Last Will and Testament: Confirm your beneficiaries and appointed executor are still correct.
- Trust Documents: Ensure your trust reflects your most current assets and wishes.
- Power of Attorney: Designate someone you trust to handle financial matters if you’re incapacitated.
- Health Care Directive/Living Will: Confirm your medical care preferences are accurate and that your chosen health care agent is still the right fit.
5. Do I Need to Update My Beneficiary Designations?
Answer: Absolutely. Many assets—such as life insurance policies, retirement accounts, and certain bank accounts—pass directly to the beneficiary named on the account, regardless of what your will or trust states. Ensuring these designations match your wishes is crucial to prevent unintended distributions and family conflicts later on.
6. How Can an Attorney Help with the Review?
Answer: Working with an estate planning attorney offers you:
- Legal Guidance: I stay up-to-date with new laws and regulations to ensure your plan remains compliant.
- Strategic Planning: Whether you’re concerned about minimizing taxes, avoiding probate, or preserving privacy, I can recommend options that align with your goals.
- Document Updates: I’ll quickly revise your existing documents to reflect life changes or implement new strategies.
7. What if I Don’t Have an Estate Plan Yet?
Answer: If you haven’t started estate planning, the new year is a great time to begin. Even simple
documents—like a basic will, health care directive, and power of attorney—can provide peace of mind and protect your loved ones from legal complications down the road.
8. How Do I Schedule an Estate Planning Checkup?
Answer: You can contact me, Sheila Kelly, by filling out and sending the “Contact Me” form on this website or simply call me to set up a free initial consultation. During this free consultation, I will answer any questions, review any estate planning documents you already have, discuss your estate planning options, and let you know the best plan for your situation.
Remember: Estate planning isn’t just for the wealthy—it’s for anyone who wants to protect their loved ones and ensure their assets are handled according to their wishes. A routine checkup in the new year is one of the best ways to keep your plan on track and enjoy the peace of mind that comes from being prepared.