Wednesday, January 30, 2013

Updating Wills and Living Trusts

In 1999, we created our first set of estate planning documents:  wills, revocable living trusts, health care power of attorney, and living wills.  The catalyst for doing these was a transfer to another country by my company.  We were advised that it was important to document our estate transfer wishes; otherwise, the transfer would follow the laws of the country in which we resided.  At the time, we were in our late 30s and early 40s and  married with no children.

Over the past 13+ years, there have been a few changes that may affect the documents from 1999.   First, the estate tax exemption amount has increased from $650,000 to $5.25 million.   Second, we have an eight year old daughter.  Third, my parents have both passed away.

Although some of these changes, e.g. having children and changes to the estate tax exemption, were accounted for in the general terms of our documents, it will be worthwhile to review our documents in the context of the specific changes that have happened.  

I expect that we will be making some slight modifications to the documents to reflect our current situation.  Also, I expect that how assets are transferred to our heirs will be executed differently based on the higher estate tax exemption.
For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial or estate planning advice. Please consult a professional advisor.

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