Four Estate Planning Details Worth a Second Look

When people tell me they already have an estate plan, one of the first things I want to know is what they mean by that.

Maybe they had a will prepared when their children were young. Maybe they created a trust a few years ago. Or maybe they have a folder of documents that they haven't looked at since the day they signed them.

All of those are good starts. But one thing I've learned from working with families is that having the documents and having everything work together aren't always the same thing.

Take beneficiary designations. Your retirement accounts and life insurance policies generally pass according to the beneficiary forms on file, not according to your will. And those forms are incredibly easy to forget about. You may have filled one out when you started a job years ago and never thought about it again.

That's why beneficiary designations are something I want to look at as part of the overall planning process. Who is listed? Is there a contingent beneficiary? And, most importantly, does it still make sense with the rest of the plan?

Trusts have their own version of this issue. Signing a revocable living trust doesn't automatically move your assets into it. There is a separate process called “funding” the trust, and it's an important part of making the plan work.

This is something I spend quite a bit of time on with my trust clients because I don't want them walking away with a beautifully drafted trust and no idea what they're supposed to do with it.

And then there's something that doesn't get nearly enough attention: what happens if you need help while you're still alive?

A will isn't designed for that. Your financial power of attorney, health care documents, advance directive and HIPAA authorization are the documents that help answer questions like: Who can handle my finances if I can't? Who can make medical decisions for me? Who can talk to my doctors?

For a lot of families, those questions are every bit as important as who receives their property someday.

Finally, even a really good estate plan can become outdated. Kids grow up. Families change. People move. Assets change. The person you thought was the perfect choice to handle something ten years ago may not be the person you would choose today.

That's one of the reasons I include a complimentary three-year review with my estate plans. I don't think estate planning should be something you do once, put on a shelf and never think about again.

So, if you already have an estate plan, here's a worthwhile question to ask yourself:

Do all the pieces still match?

You don't necessarily need to start over. Sometimes you just need to pull everything out, take a fresh look at it, and make sure the plan you have still fits the life you're actually living.

And if you're not sure, I'm always happy to help you figure that out.