Good Reasons to Update or make a New Last Will and Testament

Our lives continually change over time and so do your estate-planning needs.
Update your Last Will and Testament to reflect family births, deaths, separations, or divorces. Review guardian, trustee, and personal-representative designations. Examine the types of specific gifts to people or groups you have made or wish to make; and recalculate how much life insurance you need, if any.

Even if you have created your Will and an estate plan, it is always a good idea to revisit them as your life circumstances change. Some momentous events in your life will require revisions to these documents and plans such as when:

You Get Married
Your new spouse does not always become your primary heir automatically. For instance, if you don't have children, your parents or siblings would inherit your estate. If you wish to leave all your property to your spouse, a new Will is required. Keep in mind that you cannot disinherit a spouse without his or her consent.

Additionally, if you are living with someone but are not married and you want your significant other to inherit any of your property, you need a Will.

You Become a Parent
How will your children be cared for both financially and physically if both you and your spouse pass away. A Will is required to name a guardian for your children at your death.

You could also consider using testamentary trusts, a trust in your Will, to handle assets that would go to your children.

The execution of a durable power of attorney naming your spouse, or someone else to act for you in financial matters when you cannot, serves to operate during your lifetime but ceases to be useful at your death.

You Approach Middle Age
As you Age, your assets are growing, therefore some tax planning is an excellent way to save your heirs thousands in federal estate taxes. The time to make these tax plans is when you and your spouse have a combined net worth, including house, retirement plans, and insurance proceeds, that comes close to the amount subject to the federal estate tax. You can give an unlimited amount to your spouse tax-free, by designating it in your Will, or by owning all assets jointly, but with a little more planning, a married couple can leave twice the amount of the estate-tax exemption--up to $7 million after the second spouse dies, assuming that Congress reinstates the estate tax that lapsed at the end of 2009 and continues the $3.5 million exemption in effect at that time.

You Get Divorced
Once you are divorced you should review absolutely everything in your estate plan. The people in your life will change and that is why you must change your estate plan. You need a new Will altogether because in most states a divorce automatically revokes the provisions of a Will that apply to a former spouse. In some states a divorce may revoke the entire Will.

You may want to set up trusts to control the assets you plan to leave your children without your former spouse’s involvement and access and you will want to revise any existing Trusts created prior to the divorce, to remove your former spouse as a beneficiary or trustee.

Additionally you should change your durable power of attorney or a Living Will and, unless restricted by a divorce decree, make sure you change the beneficiaries on your life insurance, pensions, and IRA.

You Remarry
You and your new spouse may need to plan for your blended families from prior marriages and you may need a plan for additional children you have together. A prenuptial agreement may be an excellent part of your estate plan, should you want to keep assets separate and nullify your inheritance rights to each other's estates or you may want to provide for your new spouse yet still be certain your children are taken care of adequately.

You Retire or Move to Another State
If you retire and/or move to another state, you should always have your estate-planning documents reviewed taking into account that new state's laws and your current financial and medical needs.

Durable powers of attorney become even more important during your retirement years. For example, if you are stricken with a stroke or Alzheimer's disease, you may become unable to give the required consent for financial transactions, so you want to be sure that you designate an agent to make these important transactions for you if you cannot do it yourself.

Life insurance coverage may not be needed anymore. But if your estate faces an estate-tax liability or if your spouse is dependent on retirement income that will end with your death, consider keeping some coverage. Also, consider taking out a long-term-care insurance policy to help with medical costs.

Your Spouse Dies
This loss can leave you emotionally vulnerable to financial mistakes. Take your time in making any changes. For at least six months, avoid selling your house or making other drastic changes to your lifestyle.

If your spouse's estate is subject to the federal estate tax seek expert tax advice; there may be tax benefits to disclaiming some of your inheritance in favor of alternate beneficiaries, such as your children. You'll need to make a new Will and possibly a Trust.

It is a good idea to review and execute a new durable power of attorney and a Living Will (which expresses your wishes in case of an illness that leaves you permanently incapacitated) every five years so the date of signing is not stale and they continually reflect your current wishes and life’s circumstances.

Put all of your estate planning documents in a safe place, and tell people who need to know where they can be found when needed

REASONS TO UPDATE YOUR ESTATE PLAN

Many people think that once they have put together their legal documents these documents will protect them forever. That may not be the case. Estate planning is an ongoing process. You must not only develop and implement a plan that reflects your current financial and family situation; you must also constantly review your current plan to ensure it fits in with any changes in your life and circumstances.

With the extensive changes under the 2001 tax act and the Deficit Reduction Act of 2005, and the probability that more changes will occur in this decade, reviewing your estate plan regularly is now more critical than ever.

Family changes. Marriages, divorces, births, adoptions, and deaths can all lead to the need for estate plan modifications.

Increases or Decreases in your income or net worth. What may have been an appropriate estate plan when your income and net worth were much higher or lower may no longer be effective today.

Geographic moves. Different states have different estate planning regulations. Any time you move from one state to another, you should review your estate plan.

New health-related conditions. A child may develop special needs due to physical or mental limitations, or a surviving spouse's ability to earn a living may change because of a disability.

Your present Estate Plan was implemented more than three years ago. Many financial institutions will not honor your Power of Attorney documents if they were signed a long time ago. They may consider them to be “stale.”

Laws change. The current validity of your documents may have been affected by recent changes in the law; make sure your Estate Plan still complies with the laws of today.

Such circumstances often require an estate plan update.

MASSACHUSETTS HEALTH CARE PROXY

The Massachusetts Health Care Proxy is a basic and essential legal document that allows you to name someone you know and trust to make health care decisions for you if, for any reason and at any time, you become unable to make or communicate those decisions for yourself. Under the Health Care Proxy Law, M.G.L. Chapter 201D, a person must be a competent adult 18 years of age or older before he can appoint a Health Care Agent, and that Agent must also be a competent adult who is at least 18 years of age at the time he or she is appointed.

An Agent will make decisions about your health care only when you are, for some reason, unable to do that yourself. This means that your Agent can act for you if you are temporarily unconscious, in a coma, or have some other condition in which you cannot make or communicate health care decisions. Your Agent cannot act for you until your doctor determines in writing, that you lack the ability to make health care decisions for yourself.

Acting under the authority of the Health Care Proxy document, your appointed Agent can make any health care decision for you that you would make if you were able to communicate. If you give your Agent full authority to act for you, he or she can consent to or refuse any medical treatment, including treatment that could keep you alive.

Your Agent will make decisions for you only after talking with your doctor or health care provider, and after fully considering all the options regarding diagnosis, prognosis, and treatment of your illness or condition. If the document is properly constructed and it includes language established in accordance with the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), your Agent will have the legal right to obtain any information, including confidential medical information, necessary to make informed decisions for you. Your Agent will make health care decisions for you in accordance with your wishes or according to his/his assessment of your wishes, including your religious or moral beliefs.

It is recommended that you talk with your doctor(s), religious advisor, and other members of your family before giving instructions to your Agent. It is very important that you talk with your Agent and other members of your family, so that they all know what is important to you. If your Agent does not know what your wishes would be in a particular situation, your Agent will need to decide based on what he or she thinks would be in your best interests. If your family does not know what your wishes would be in a particular situation then they may object to a decision made by your Health Care Agent which could not only trigger a Court intervention but also cause a possible delay in your medical treatment.

Your Agent’s decisions will have the same authority as you would have if you were able to communicate, and he or she will be honored over those of any other person, except for a Court Order specifically overriding the Proxy.