Have you ever moved in your life? If so, did you submit a change of address with the US Postal Service? Of course you did, otherwise your mail would be delivered to your old address for who knows how long and the new residents would either throw it away or mark it “return to sender”. Anyone who is moving knows that’s one of the first things you do.
There are other life changes that we all go through. We get married, have children, those children eventually grow up and move on to attend college and hopefully get jobs. Sometimes there is divorce or death and that could lead to a second or third spouse and possibly more children. As an ancient Greek philosopher said, the only constant in life is change.
Just like you would never move without submitting the change of address form, you shouldn’t let life’s changes go by without a regular review of your estate planning documents. Otherwise, you could end up with the equivalent of a “return to sender” marking on your possessions if you die.
Quick side note to list the most common estate documents and their purpose: Last Will & Testament (says where your stuff goes when you die); Power of Attorney (says who can do stuff for you, mostly legal and financial); Health Care Proxy (says who can do medical stuff for you if you are not capable).
Now take a moment and think of the answer to this question: when was the last time you dusted off one or more of those estate documents and looked them over? Does your Will still include a section naming a guardian for your children who are now long past 18? Does your Power of Attorney name an agent who is no longer a good fit? Or maybe you don’t have one or more of these documents and you’ve been meaning to see an attorney to get them drafted but haven’t taken the time to do it? Now is as good a time as ever.
It is also important to review your beneficiary designations on any retirement or transfer on death accounts you have. You will want to make sure everything matches up, or at least is set up how you want it. Keep in mind that just because in your Will you say that your spouse gets everything when you die it doesn’t mean they will also get your IRA. Any account with a beneficiary – and that includes all retirement accounts – will be distributed based on the beneficiaries you name directly with each plan or account no matter what your Will says. If you are not careful, that could lead to a surprise for your loved ones after you are gone.
Having current estate documents is important, especially when you might need someone to take over paying your bills or talking with a doctor on your behalf. My advice is to take an evening, or a weekend, and look over what you have, then map out changes you want to make and an estate attorney can take it from there. Do not leave life up to chance, make sure your wishes are honored after you are gone and you are protected while you are still alive. Do not end up with “return to sender” governing your assets.
As always, if you are interested in talking further about this topic or any other relating to your financial present or future, you can reach out to an advisor at John G. Ullman & Associates, Inc., at any point (www.jgua.com). We are here to help.