Retirement Guys: 5 reasons to update your estate planWritten by Nolan Baker Mark Clair | | firstname.lastname@example.org
If you are like me (Mark), you have come to the realization that time is going by very quickly. It seems like yesterday I was graduating from college, getting married, having kids and we had our whole lives ahead of us. We were excited about the future in anticipation of what life would bring. I have to say, it has definitely been a great ride so far and we have been truly blessed. We have gone from just starting out to our most recent phase of life called empty nest syndrome. Along the way we have had the joy of raising three wonderful children, Lisa has established a great career as a School Psychologist and I as an Attorney/Financial Adviser for our company The Retirement Guys, and have enjoyed our lives even though like anyone there has been stress and rough times. Though some are saddened by the empty nest phase we are embracing each new experience, enjoying a little peace and quiet and what may come next. I don’t know if I am quite ready for it yet, but thoughts of becoming a grandparent at some point soon have crossed my mind. I don’t like the idea of being at that age, but look forward to bonding with our future grandkids and enjoying the whole experience.
As a lawyer that does quite a bit of estate planning, changes in life creates the need to update your estate plan. If you haven’t completed an estate plan yet, do not delay. You don’t know what tomorrow holds and none of us have been promised that tomorrow will even come. As time goes on, you realize that “life happens.” I feel strongly about helping folks realize that you don’t know how life will play out. In recent years we have experienced the deaths of my father, mother-in-law, father-in-law, grandfather and uncle. These were shocking events. We are still shaking our heads and don’t feel like it is real, yet it is. We never expected my uncle to have 3 strokes and a heart attack at age 52 and die at age 58. We never dreamed that my mother-in-law would be diagnosed with leukemia and be gone 18 months later. Nolan to this day is deeply affected by the sudden death of his father on a golf course one night in his 40’s. I went to a conference recently and I thought the speaker put it well in that in order to help people plan he asked them to “be brave enough to face their own mortality and be wise enough to do something about it.” Time is flying by. Enjoy every day and live in the present, but be smart enough to plan for the future.
Here are some reasons to update your estate plan:
1. Somebody has been born. New children or grandchildren are reasons to revisit what your plan says. Do you want them included? If so, make sure they are not unintentionally disinherited.
2. Sale or purchase of a major asset. Have you allowed for this in your plan? If you have a Living Trust, did you get this asset titled in the trust? Many make the mistake of not titling assets correctly.
3. Somebody died. Sad as it may be, have you allowed for what happens if the person or persons that are to inherit died before you? What happens to their share?
4. The laws have changed. This happens without most people even realizing it. Does your estate plan reflect the latest rule changes? Your old estate plan could end up causing a mess because you never updated it to reflect new rules. You should probably review your plan every 2-3 years at the least.
5. DO YOU HAVE A FAIRLY LARGE RETIREMENT ACCOUNT? Some estate planners never even address the problem of the income taxation of a traditional retirement account like an IRA, 401k, 403b, 457, etc. Money in these accounts has never been taxed. You have worked hard to accumulate it, so do you now know the rules that apply when you start to take it out? What happens when your kids inherit it? Will they have to pay an enormous tax bill? There are rules in place that you may be able to take advantage of.
There are other reasons to update your plan. These are just a few important ones that come to mind. Remember that information is key. There are a couple reports you can get by going to retirementguysnetwork.com. 10 Biggest Mistakes When Setting Up a Living Trust and What You Should Ask When Choosing Your Estate Planner are two that come to mind. As always, information means nothing without action. Get it done.
For more information about The Retirement Guys, tune in every Saturday at 1 PM on 1370 WSPD or visit www.retirementguysradio.com. Securities and Investment Advisory Services are offered through NEXT Financial Group Inc., Member FINRA / SIPC. NEXT Financial Group, Inc. nor its representatives provide tax advice. The Retirement Guys are not an affiliate of NEXT Financial Group. The office is at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537. 419-842-0550.