The Importance of Keeping Your Estate Plan Up to Date

I was reminded of the importance of keeping your estate plan up to date last month when a client asked me to probate her father’s estate.  Her father, who I’ll call “James”, prepared his estate plan over 15 years ago.  Since that time, one of James’ children passed away, both of the individuals he nominated as his Personal Representative have died, and he purchased an investment property in Sunnyvale, California.  Since James’ estate plan was not updated, none of these changes were addressed in his estate plan, which created significant problems for his beneficiaries.

First, because James owned property in Idaho and California, he should have had a Revocable Living Trust as part of his estate plan.  A Revocable Living Trust would have allowed his estate to avoid probate in both Idaho and California.  Instead, because James only had a Will, his beneficiaries had to hire attorneys in both states and pay probate fees in both states.  California has some of the highest probate fees in the United States, so the amount his beneficiaries inherit will be reduced by tens of thousands of dollars. 

Second, James’ 15-year-old estate plan did not address the fact that one of his children predeceased him.  James’ Will directed that the estate be divided between his “then-living” children, which effectively disinherited his deceased child’s son (i.e. his grandson).  If James had updated his estate plan, he likely would have made provisions for his grandson.

Third, because both people James nominated as his Personal Representative were deceased, this issue had to be addressed during probate, making the process more time consuming and costly.  It also caused a strive between James’ two oldest children, each of whom thought they would make the better Personal Representative.

Finally, because it had been such  a long time since James prepared his estate plan, none of his adult children knew where to find the original copy of his Will, which they needed for the probate proceeding.  The attorney who prepared James' Will had also died, which made it even more difficult to locate the original Will.  

All of the problems encountered by James' beneficiaries could have been avoided if James had updated his estate plan.  By taking the time to review and update your estate plan, you ensure your plan reflects your current wishes and your loved ones are spared unnecessary hassle and expense.
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