There are many components to an estate plan and it’s important to carefully consider each one. Most estate planning tools are pretty flexible while you are alive, however there are many things that are difficult to change and even a few that can’t be at all, such as an irrevocable trust.
Most estate plans become fixed after your death, unless clauses are added to allow trustees or executors leeway to make any necessary changes resulting from evolving circumstances.
There are many considerations to make when you want to get your assets to the correct person, in the correct amount, in the most efficient and cost effective means possible, and in a way that is best for them.
The estate plan will be different depending on if they are your spouse, a minor child, have trouble managing money, owe a lot of debt, are planning to go to college or get married, are married and have children, etc.
While it may be easy changing beneficiaries on a will or revocable living trust from a legal point of view, the emotional toll may be quite high.
Beneficiaries and co-owners will age over time and you may need to account for this. For example, if you want your:
What is best for your beneficiaries could involve avoiding the probate process, preventing other family from contesting the inheritance, and choosing the correct tool for the asset, such as:
It is most common to name a family member or trusted friend as your agent, but it may be best in some situations to choose a more objective third party.
While a high level of trust is the most crucial part of any trustee, there are other things to consider before finalizing your choice.
Assets in your will are transferred according to your wishes and you can include any level of detail in your instructions. While you can change these instructions while you are alive, they are fixed after your death. It may be important to consider the long-term effect of inheritance on your beneficiary and plan accordingly.
Even when you place your trust’s assets in the control of a trustee, you can still give explicit instructions about how the trustee manages them. Since a trust is a dynamic financial tool, providing details is a more difficult process and requires more thought and professional help.