With the holidays now behind us, we enter a new year—a time for fresh starts, new resolutions, and an opportunity to focus on important tasks that may have been overlooked during the holiday season. One such task is reviewing and updating your estate plan, which is crucial for ensuring that your wishes are clear and your loved ones are taken care of.
At Jenkins & Jenkins, we understand that estate planning can feel like a daunting task, but we’re here to guide you through the process. The start of the new year is an excellent time to ensure your documents are up to date and reflect your current wishes. Here’s a practical checklist of things to consider as you enter the new year.
Review and Update Your Will
Your will can be one of the most important documents in your estate plan (especially if you do not have a trust). It outlines how your assets will be distributed and can even specify who will care for minor children or dependents. But life changes—family dynamics shift, new assets are acquired, and priorities evolve.
What to do:
- Review the beneficiaries: Are the people you want to inherit your property still the right choices? Have any family members or friends passed away or experienced significant life events? If so, it might be time to update your will to reflect those changes.
- Adjust asset distribution: Have your assets, such as real estate, investments, or family heirlooms, changed over the years? Ensure your will reflects these changes.
- Name guardians for minor children: If you have children, make sure that the guardianship designations in your will are still in line with your wishes.
Reviewing your will ensures that your estate will be distributed according to your intentions—giving you peace of mind as you move into the new year.
Update Beneficiary Designations on Financial Accounts
Beneficiary designations are often overlooked, but they play a critical role in ensuring that your assets go to the right people. Accounts such as life insurance policies, retirement accounts (401(k)s, IRAs), and bank accounts often pass directly to the beneficiaries you’ve named, bypassing your will entirely.
What to do:
- Check all accounts: Take the time to review all of your financial accounts, including retirement accounts, insurance policies, and even digital accounts (like PayPal or investment platforms). Make sure the beneficiaries listed are still correct.
- Update names as needed: If there have been any changes in your life—such as a marriage, divorce, birth of a child, or the death of a beneficiary—be sure to make the necessary updates to your accounts.
- Consider contingent beneficiaries: In case your primary beneficiary predeceases you, make sure you have contingent beneficiaries named as a backup.
By reviewing and updating your beneficiary designations, you ensure your loved ones will receive the assets you intend to leave them, without delays or complications.
Review Your Health Care Directives and Power of Attorney
Your health care directives and power of attorney documents ensure that your wishes are respected if you become incapacitated. As you review your estate plan, it’s essential to check that these documents still align with your current preferences and circumstances.
What to do:
- Health care directive (Living Will): This document outlines your wishes for medical treatment in the event you cannot communicate your preferences. Review it to ensure your instructions are clear and reflect any changes in your health or views on medical treatment.
- Durable power of attorney for health care: This appoints someone to make medical decisions on your behalf if you’re unable to. Be sure the person you’ve chosen is still the best choice.
- Financial power of attorney: If you haven’t already, consider creating a durable power of attorney for financial decisions. This allows someone to manage your financial affairs if you become incapacitated.
These documents help ensure that your healthcare and financial decisions are in trusted hands when you can’t make them yourself. Review them carefully to make sure they reflect your current preferences and family dynamics.
Have Conversations with Your Loved Ones
Now that the stress of the holidays are over, it’s a great time to initiate important conversations about your estate plan with your loved ones. Talking openly about your wishes can prevent misunderstandings or conflicts in the future.
What to do:
- Discuss your intentions: Have a conversation with your loved ones about your estate planning decisions, such as who will inherit assets, serve as your executor, or manage your care if needed. This can help avoid surprises and give your family a clear understanding of your wishes.
- Explain the importance of your documents: Sometimes, family members may not understand the importance of a will, trust, or health care directive until it’s too late. Take a moment to explain your decisions and why they’re important.
- Address potential concerns: If you have concerns about how family members will react to certain decisions (such as guardianship or asset distribution), it’s best to address these early on. Open communication can prevent future disagreements.
These conversations can be challenging, but they are essential for ensuring your wishes are respected and your loved ones are prepared.
Review Your Trust (If You Have One)
If you have a living trust in place, it’s essential to review it regularly. A trust helps avoid probate, provides privacy, and ensures that your assets are managed according to your instructions.
What to do:
- Check your asset allocations: Ensure that all of your significant assets are correctly titled in the trust’s name. If you’ve acquired new assets over the past year, make sure those are transferred to the trust.
- Review trustee designations: Has the person you appointed as trustee changed their address, contact information, or even their willingness to serve? Ensure the person you’ve chosen is still the best fit for the role.
- Consider updates: If your family situation or financial goals have changed, now may be the time to adjust your trust accordingly.
Keeping your trust updated ensures that your assets are distributed efficiently and according to your wishes, avoiding unnecessary delays and complications for your loved ones.
Organize Important Documents
One of the simplest yet most impactful tasks you can complete as you enter the new year is organizing your important estate planning documents. By keeping everything in one easily accessible location, you’ll provide your family with the clarity and resources they need to carry out your wishes when the time comes.
What to do:
- Create a safe storage plan: Store your estate planning documents, including your will, trust, health care directives, and powers of attorney, in a safe place—whether that’s a fireproof safe at home or a secure online vault.
- Make a list of key contacts: Keep a list of important people who are involved in your estate plan, such as your attorney, financial advisor, and the person you’ve appointed as executor or trustee.
- Provide copies to trusted family members: While you should keep the original documents in a safe location, it’s also a good idea to provide copies to trusted family members, such as your spouse, children, or close friends.
By keeping your documents organized and easily accessible, you make the process smoother for your loved ones during a difficult time.
Conclusion
As we move into the new year, taking the time to review and update your estate plan can provide invaluable peace of mind for you and your family. This is the perfect opportunity to ensure that your estate planning documents are current, your wishes are clearly communicated, and your loved ones are prepared for the future.
At Jenkins & Jenkins, we’re here to help guide you through every step of the estate planning process. Contact us today to schedule a consultation and make sure your estate plan is in order for the new year.
