How Often Should I Update My Will or Trust?

After my clients have signed their wills or trusts, they usually ask me how often they need to have them reviewed and possibly updated. In general, the answer varies depending on the complexity of their estate and other factors in their family. However, I generally tell people that it is a good idea to have your estate plan reviewed every three to five years. For larger estates, this timeframe gets shortened up to every one to two years, and, for small estates, it may be possible to do the reviews at longer intervals. Of course, I also tell them that this assumes that there are no changes in their family situation “on their end” and no significant legal changes “on my end”.

What Are Changes That Might Occur on “Your” End?

There are several changes that might occur in your family that would prompt you to make changes to your will or trust. First, one of the key people in your documents (maybe the person you named as your trustee or your agent under your durable general power of attorney) passes away or becomes incapacitated. Obviously, if the person that you were expecting to be in charge of your estate can no longer serve in this position, you will need to make some changes to your documents. Second, when someone gets divorced or remarries, they usually want to make changes to these documents. Third, sometimes over time, people develop different ideas about how they want their distribution provisions to work. Sometimes these changes are prompted by the birth of a grandchild, sometimes by the behavior of some of their children, sometimes because of the death or incapacity of a child, or sometimes because of their involvement in their church or a favorite charity. Finally, there are endless other reasons too, which are all specific to changes in your family situation.

What Are Legal Changes That Might Occur on “My” End?

On my “end”, various legal changes occur over time. For instance, there may be a significant tax law change that impacts the planning that I do for my clients. The estate tax exemption is now $5.43 million per person in the United States, meaning that, generally speaking, you can pass away with up to $5.43 million in your estate without having to pay estate tax. When the previous estate tax exemption increased to $5 million permanently, with an annual cost of living adjustment, this was a huge change, and I have recommended that several of my clients make major changes to their trusts as a result of this change. One other change that impacts all of my clients is the enactment of the mental health care power of attorney statutes in Arizona a few years ago. Now, the typical health care power of attorney will not cover things such as Altzheimer’s or dementia if mental health care treatment is ever needed in the future. As a result, I have recommended to all of my clients that they do a mental health care power of attorney as well as their wills, trusts (if applicable), and other powers of attorney. Finally, one other change in the law that has affected almost all of my documents is the Health Insurance Portability and Accountability Act of 1996 (aka HIPAA) laws. HIPAA laws are intended to protect the privacy of your health care information. However, HIPAA authorization language has “crept” into all of my health care documents, trusts, and durable general powers of attorney because health care information is almost always necessary to make a determination about someone’s incapacity.

A Couple of Other Things to Keep in Mind . . .

With all that said, there are a couple of other things to keep in mind when you are deciding whether it is time to have your documents reviewed:

1. Don’t try to do the changes yourself. I have had some clients attempt to make the desired changes to the documents themselves. This can have disastrous results. For one, depending on how much you mark up a document, the “mark-ups” could have the effect of voiding the document. Second, if a separate document is drafted to amend the first document, it will not be valid unless the correct formalities are followed as far as signatures by witnesses and a notary public. Therefore, you may think that you have amended your Will, but, if it is not executed correctly, it will have no legal effect. The bottom line here is make sure to go with a trusted estate planning attorney to draft the changes for you.

1. If your last Will was done in another state and you are moving to Arizona permanently, then I recommend that you have your documents reviewed by an Arizona attorney as soon as possible. I see it happen all the time. A couple moves here from the Midwest to retire, because of a job relocation, or maybe to be near the grandkids. They had their wills done in the 1980’s when their children were minors, they move to Arizona, and they come see me and ask me if their wills are still valid. The short answer is, if the will was validly executed under Michigan law (or any other state’s law), then it is a valid will in Arizona. However, I also tell people that, if you are planning to live here permanently, then I recommend that you update your documents to comply with Arizona law because everyone here is much more familiar with Arizona documents and it will be easier to administer these documents when they are needed. In addition, if it has been 30+ years since you updated them, you probably need to revise them anyway.

1. If you move from Arizona to another state permanently, then I recommend that you have your documents reviewed by an attorney in the other state as soon as possible. According to the same rationale, if one of my clients with a will or trust moves to California, then I recommend that they have their documents reviewed by a California attorney as soon as possible after they move there.

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