How Well Do You Know Your Estate Plan?
Creating an estate plan is an important step, but signing the documents does not mean that you should put them away and never think about them again.
Your estate plan may eventually need to guide your family through a medical emergency, incapacity, or death. If years have passed since you last reviewed it, the people you selected may no longer be the right choices, your assets may have changed, and some of the instructions may no longer reflect what you want.
Having an estate plan and knowing what it says are two different things. Use the following questions to see how well you understand your current plan and whether it may be time for a review.
1. Who Is Named as Executor of Your Will?
Your executor is responsible for managing your estate after your death. Their responsibilities may include locating assets, addressing debts and taxes, communicating with beneficiaries, and distributing property according to your will.
Consider whether your executor:
Knows they have been selected
Is still willing and able to serve
Remains someone you trust
Has the time and organizational skills required
Knows where to find your original will
If you cannot immediately remember who you named, or if your relationship with that person has changed, your will may need to be reviewed.
2. Who Is Your Alternate Executor?
An alternate executor can step in if your first choice has died, become incapacitated, declined the appointment, or is otherwise unable to serve.
Without a qualified alternate, the court may need to appoint someone to administer the estate. That person may not be the individual you would have selected.
Naming an alternate provides another layer of protection and can prevent unnecessary delays.
3. When Will Your Children or Other Beneficiaries Receive Their Inheritances?
An estate plan can control more than who receives your property. It can also determine when and how an inheritance is distributed.
For example, a trust may hold property for a child until a particular age or distribute funds at several stages. It may also allow a trustee to use money for education, healthcare, housing, and other needs before the beneficiary receives the remaining assets directly.
An age or distribution schedule that seemed appropriate when the plan was created may no longer fit the beneficiary’s maturity, financial circumstances, health, or needs.
Reviewing these instructions can help determine whether the plan still provides the level of protection you intended.
4. Who Did You Choose as Guardian for Your Minor Children?
A will allows parents to state whom they would want to care for their minor children if neither parent is able to do so.
Ask yourself:
Is your selected guardian still willing to serve?
Is the person physically and financially able to care for your children?
Does the person’s current home and family situation make sense?
Does the person share your general values and parenting priorities?
Have you named an alternate guardian?
Family circumstances can change considerably over time. Someone who seemed like the right choice several years ago may have moved, experienced health problems, developed new responsibilities, or become less involved with your family.
The court ultimately considers the child’s best interests, but clearly documenting your wishes gives the court valuable guidance.
5. Who Can Manage Your Finances If You Cannot?
Estate planning is not limited to what happens after death. It should also protect you during your lifetime.
A financial power of attorney allows someone you select to handle authorized financial and legal matters if you are unable to manage them yourself. Depending on the authority provided, this may include paying bills, managing accounts, dealing with insurance, signing documents, handling property, and communicating with financial institutions.
Make sure you know:
Who is named as your financial agent
Whether an alternate agent is named
What authority the document provides
Whether financial institutions will be able to use the document
Where the original or an accessible copy is kept
An outdated power of attorney can create problems when your family needs to act quickly.
6. Who Can Make Healthcare Decisions for You?
Your healthcare documents should identify someone who can make medical decisions if you cannot communicate your wishes.
The person you select should understand your preferences and feel comfortable speaking with doctors, reviewing treatment options, and making difficult decisions when necessary.
It is important that this person knows they have been chosen. You should also discuss your wishes with them before an emergency occurs rather than expecting the document to explain every possible situation.
If the person you originally selected is no longer available or appropriate, your healthcare documents should be updated.
7. Do Your Beneficiary Designations Match Your Estate Plan?
Certain assets are generally transferred according to beneficiary designation forms rather than the instructions in your will. These may include:
Life insurance policies
Retirement accounts
Annuities
Payable-on-death accounts
Transfer-on-death accounts
A beneficiary designation can remain in place for years without receiving much attention. As a result, an account may still name a former spouse, a deceased relative, or someone you no longer intend to benefit.
You should review these forms after major life changes and coordinate them with the rest of your estate plan. Updating your will alone may not change who receives an account with a separate beneficiary designation.
8. Are Your Major Assets Properly Titled?
The way an asset is owned can determine whether it passes through probate, transfers to a surviving owner, or is administered through a trust.
If you created a trust but never transferred intended assets into it, the trust may not accomplish everything you expected. Similarly, adding another person as a joint owner without understanding the consequences can affect control of the asset during your lifetime and its distribution after your death.
Review the ownership of your home, financial accounts, business interests, and other major assets. Those ownership arrangements should work together with your will, trust, and beneficiary designations.
9. Does Someone Know Where to Find Your Original Documents?
Even a carefully prepared estate plan can be difficult to use if no one can locate the original documents.
Your executor and other decision-makers should know where your will, trust, powers of attorney, healthcare documents, insurance information, and important financial records are stored. That does not necessarily mean giving everyone copies of everything, but at least one trusted person should know how to access the documents when needed.
Original documents should be stored somewhere secure but accessible. A location that no one else knows about can create delays at exactly the wrong time.
10. Does Your Plan Address Digital Assets and Online Accounts?
Much of a person’s financial and personal information is now stored online. Your estate may need to address:
Email accounts
Social media profiles
Cloud storage
Digital photographs and videos
Online payment accounts
Websites and domain names
Subscription services
Cryptocurrency and other digital property
Online businesses or sources of income
Your family may know these accounts exist but have no way to locate or manage them. Older estate planning documents may also lack appropriate language authorizing someone to access digital information.
A secure inventory can help your executor identify your accounts. However, passwords and other sensitive information should be stored carefully rather than written directly into a will, which may eventually become part of a court record.
How Did You Do?
This is not a formal test, but your answers can reveal whether your estate plan still reflects your life.
You Answered Nearly Everything Confidently
Your plan is probably familiar and reasonably current. Even so, continue reviewing it after major life events and periodically confirm that your decision-makers and beneficiary designations remain appropriate.
Several Questions Made You Stop and Think
Some of the details may have faded since your documents were signed. Reviewing the plan can refresh your memory and identify smaller changes before they become larger problems.
You Could Not Answer Many of the Questions
That does not mean your estate plan has failed. It means that it is time to locate your documents and review them carefully.
You may find that the plan is still appropriate. You may also uncover outdated appointments, missing alternates, uncoordinated accounts, or instructions that no longer reflect your family.
When Should You Review Your Estate Plan?
You should consider reviewing your estate plan after significant changes such as:
Marriage or divorce
The birth or adoption of a child
The death or incapacity of someone named in the plan
A child reaching adulthood
Buying or selling a home
Moving to another state
Starting or selling a business
Receiving a significant inheritance
Retirement
A major change in finances or health
A change in your relationship with an executor, trustee, guardian, or agent
Even when there has not been a major event, a periodic review can confirm that the plan still works as intended.
Contact The Law Offices of Joseph D’Urso
If this review revealed an answer you could not remember, a person who is no longer the right choice, or an asset that may not be coordinated with your documents, now is a good time to review your estate plan.
We help individuals and families understand what their existing documents say, identify potential gaps, and update their plans to reflect their current lives and priorities.
The Law Offices of Joseph D’Urso is based in Bergen County and serves individuals and families throughout New Jersey and New York. Contact our office to schedule a short introductory call and discuss your estate planning needs.
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