Regardless of how large or small your net worth is, estate planning is essential for making sure your wishes are known and respected in situations where you might not be able to communicate them yourself, and for organizing your affairs after your passing. Think of it as a roadmap for your legacy, guiding your loved ones in protecting your wishes.
A well-crafted plan reflects your current life situation, and, as your life changes, your estate plan should keep pace. Regular reviews of your estate plan—much like an annual health check—can help ensure your plans remain aligned with your current circumstances and future goals.
Why Updating Your Estate Plan Matters
Setting up an estate plan is only the beginning; it should always reflect your current situation. This is why we suggest revisiting your plan every three to five years or after significant life events. Over time, circumstances change, and so does your estate.
Life Changes
The arrival of a child, the passing of a family member, the ending of a relationship, or moving to a state with different laws can all necessitate updates to your estate plan. New assets, a business venture, or a turn in health could require revisions to your plan’s guardianships, beneficiaries, or powers of attorney.
Beneficiary designations on financial accounts take precedence over wills and trusts, which can lead to unexpected outcomes if not reviewed regularly. For instance, if you designated your ex-spouse as the beneficiary of a financial account, but your will names your current spouse, the form would most likely take precedence. Keeping these designations up to date is as important as maintaining the rest of your plan.
State and Federal Estate Tax Laws
Since 2021, estate tax laws in several states have changed, and the federal estate tax threshold may change any year. For example, the Tax Cuts and Jobs Act of 2017 raised the federal estate and gift tax exemption to $13.61 million per person for 2024. But this benefit will sunset in 2025, reverting to about $7 million unless Congress extends it. [1]
Updates like this affect how your estate is taxed and how much your heirs ultimately receive. Consulting with an estate attorney can help you navigate these changes and see to it that your plan reflects the current legal landscape. Staying informed about tax law updates is key to preserving your family’s wealth and minimizing unnecessary costs.
Managing Digital Assets
It's increasingly important to include digital assets like cryptocurrency, NFTs, online accounts, and social media profiles in your estate planning. Without proper planning, these assets could easily be lost or mismanaged. By integrating specific guidelines for your digital assets into your estate plan, you ensure that nothing is overlooked and their value is safeguarded—especially as blockchain technology evolves and further influences digital ownership practices.
Honoring Your Values
More and more individuals are choosing to weave their personal values into their estate plans. Do you want to commit to sustainability or social responsibility? One way to do this is with an ethical will, a document that outlines your intentions for charitable giving, environmental stewardship, or community support—beyond financial distribution, allowing you to create a legacy that reflects what matters to you most. Whether you include a separate document or add provisions elsewhere, the idea is to align your estate plan with your broader life principles and continue your impact on future generations.
Checklist for Estate Planning Documents
We've crafted this guide to simplify the process of updating your estate plan. Our checklist walks you through the key elements to cover and review, from beneficiary designations to digital asset management. Let's take a look at how to keep your plan up-to-date.
We designed this guide to make updating your estate plan a smooth process. Our checklist walks you through the key elements to cover and review, from beneficiary designations to digital asset management. Let's take a look at how to keep your plan up-to-date.
Will:
Verify that you have designated an executor and a backup executor. Are these individuals still the ones you trust to manage your affairs after your passing? It’s also wise to notify them of their responsibilities in case of an unexpected event.
Check that you have named a guardian and a backup guardian for any minor children. Confirm that these individuals remain the people you would trust to care for your children in your absence.
Review your beneficiary designations to confirm they align with your current intentions. Make updates if any changes are needed.
Consider including a legacy letter or “ethical will” to share the values and life lessons you wish to pass on to your family, along with any meaningful information for your beneficiaries.
Go over your list of assets, noting their locations and any updates. Clarify how you want them distributed to carry out your wishes.
Trust:
Verify that you have named a trustee and confirm that this individual is still your preferred choice to manage the trust after your passing.
Review the current structure of your trust. Does it align with your intentions? Make any adjustments necessary.
Decide how you want beneficiaries to receive their inheritance. Would you prefer they receive assets outright, or should distributions occur through income streams or at set intervals?
If beneficiaries are young, consider setting up safeguards to hold the assets until they reach a more responsible age.
Determine any additional conditions or guidelines you’d like to include for distributions.
Consider whether a professional trustee, such as an attorney, accountant, bank, or trust company, would better serve your needs.
Evaluate whether funding the trust now could help avoid probate, reduce administrative costs, and streamline the process.
Is privacy a priority? Confirm that your plan keeps personal estate details out of the courts and public record and includes measures to avoid probate after your death.
Consult your estate planning attorney about your wishes and the potential benefits of different types of trusts. As your financial situation evolves, trusts can be a valuable tool for preserving and protecting wealth for future generations.
Consider establishing a trust specifically for digital assets like cryptocurrency, NFTs, and online accounts to make sure these assets are securely managed and distributed according to your preferences.
Durable Power of Attorney:
Confirm that you have appointed someone to manage your financial and business affairs in case of temporary incapacity or permanent disability. Verify this person still reflects your current preferences. Remember, they will have the authority to manage your assets until your passing.
Review the powers you have granted to your durable power of attorney and update them as necessary to align with your current needs.
Inform your durable power of attorney of any new investments, such as business interests or digital assets, that may require special handling.
Healthcare Power of Attorney:
Verify that you’ve designated someone you trust to make medical decisions on your behalf if you are unable to do so.
Ensure your document reflects your current wishes regarding life-sustaining treatments in the event of a terminal injury or illness. Update it if your preferences have changed.
Consider whether you’d like to include a Do Not Resuscitate (DNR) order in your medical directives.
With telemedicine and digital healthcare records becoming more common, confirm that your healthcare power of attorney has the access and knowledge needed to use these tools in emergencies.
Miscellaneous Estate Planning Documents:
Review and, if necessary, update the beneficiary designations on your life insurance policies.*
Review and, if necessary, update the beneficiary designations on your retirement accounts.
Verify that all transfer-on-death instructions for bank and investment accounts reflect your current wishes.*
Provide clear, updated instructions for handling digital assets, including financial accounts, social media profiles, email, websites, and other digital files.
Reassess contingency plans for any businesses you own.
This checklist is a general guide and not an exhaustive list. The specific documents you’ll need to update will vary based on your individual situation and state laws. For tailored advice, work with a qualified financial advisor and estate planning attorney.
*Remember, designations on beneficiary forms sometimes supersede the wishes you’ve outlined in your will or trust.
Estate Planning for Life
Your estate plan tells your unique story and helps turn your wishes into reality. Keep this checklist handy as your go-to guide for future updates. It gives you a solid foundation while your plan grows with you through all of life's changes.
When was your last estate plan review? If you’ve experienced recent changes in your life or a few years have passed, reach out to your team. Your financial advisor, estate planning attorney, and accountant make a power team to help fine-tune your plan. Together, we can make sure your plan matches your vision and keeps your legacy on track.
Sources:
1. https://www.irs.gov/newsroom/estate-and-gift-tax-faqs
Russell D. Rivera, CFA, CFP®, is the Founder and President of Voice Wealth Management, an independent financial services firm serving professionals, entrepreneurs, and families in New York City and beyond. Focusing on helping clients make informed decisions about saving, investing, and financial planning, Russell is committed to providing a customized approach that reflects each client’s unique priorities and experiences.
The opinions expressed in this material are for general informational purposes only and are not intended to provide specific advice or recommendations.
This material was prepared in collaboration with Crystal Marketing Solutions, LLC, and edited using artificial intelligence, based on sources believed to be accurate. This information is for educational purposes only, does not necessarily reflect the views of the presenter or affiliates, and should not be construed as investment, tax, or legal advice.