When I work with clients who are reviewing their estate plan, many of them have an old trust from 20 (or more) years ago that they no longer need. A common scenario for them is that they had young children and had a thorough estate plan created. Interestingly, many times, even though it is a thorough estate plan with an old trust, there are no health care directives or documents. As we all age and require more medical treatment, those health care documents can be some of the most important documents in the plan.

But, as part of that estate plan, a revocable trust may be included. The kids were still in elementary school and the parents were still working long hours. If something happened to them, the trust was there to step in and protect everyone. But now, the kids are out of school. They are working and making good money themselves. Many of them have started their own families and my clients’ main job now that they’ve retired is to enjoy their time with their grandkids. So, with that in mind, we sit down and discuss what updates their estate plan needs.

Do You Need It?

The first thing we look at with an old trust is whether you still need it. Hopefully, you worked with an attorney who made sure to tailor the trust to your goals. But are those goals from years ago still the same as today? That old trust may have been designed to protect your young children, but now? It’s your young grandchildren who are at the forefront of your mind.

There are a variety of ways that you can assist your grandchildren, not all of them have to be as part of your estate plan. But that old trust you have may be better suited to be either amended or restated to reflect your current goals.

For others, the need for that old trust may be gone. While it made sense as part of your original plan, you may not need that trust anymore. There could be administrative fees tied to it. Maybe the assets that were in the trust have been sold (or need to be sold) and there would be nothing left for the trustee to manage.

No matter what the original purpose, a discussion with an attorney can help you decide if you need that old trust anymore.

Was it Funded?

A secondary question that arises often is whether you ever funded that trust. I’ve run across many trusts from years ago that were never actually funded. Hopefully, if you intended them to be funded at the time you signed your estate plan, they were actually funded. But many times, they were not. Perhaps the old trust wasn’t to be funded until you or your spouse died. In that case, the trust can be easily dealt with.

But what about if it was funded? If you have a variety of assets titled in the name of the trust? Then, if you are going to move on from the old trust, there can be some legal work involved. Those assets will need to be retitled. And there can be tax consequences. So if that’s your next step, an accountant and an attorney are very important to assist with the process. You don’t want to get that process wrong.

Next Steps

If it’s been a few years and it’s time to review your estate plan, or if you need a will or trust drafted, call my office to set up a Legal Strategy Session and we can review the best options for you – (877) AMAYERS.

Andrew Ayers
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I work with business and estate planning clients to craft legal solutions to protect their legacies.