Updated: Apr 7
Last Friday, our office received a call from a client very concerned about an estate plan she and her husband had done nearly a decade ago when they lived in Montana. The couple, in their late 60s, moved to Connecticut in 2017 and were quite concerned given the current situation with COVID-19.
“So much has happened in our lives since we did this plan,” she told Attorney Connelly. “My son was divorced and remarried, my daughter had twins and we sold some property and we bought some property. I'm worried sick right now. What if something happens to us and we didn't make the changes we should have?”
And their concerns were well placed. First, estate plans are not national plans. Each state has its own laws with some nuances around these documents. These nuances may be trivial, but they could open the door to problems. State laws may also vary on other issues such as living wills, advance medical directives, real estate holdings, and more.
"If you move to another state, it is a good idea to have your elder law attorney review the documents and update them if necessary," said Connelly. "In addition, an estate plan should be reviewed every few years or whenever a major life event occurs such as a marriage, divorce or loss of a loved one."
During a time of crisis, such as this current pandemic, we are reminded of the reason we did an estate plan – to ensure that our wishes and the documents that outline them are carried out.
“Hopefully,” said Attorney Connelly, “the couple who called us will be just fine after we review and update their plan. But what if one of them had fallen ill or worse? They were thoughtful enough to put together a pretty solid plan ten years ago but by not reviewing it after some major life events occurred, all that work could have been for naught."
If you have an estate plan, Connelly suggests taking the following steps:
Check the people and the roles of those listed in your plan. For instance, are the executors (in the will) or the trustees (in a trust), as well as all other successors suitable, able and willing to serve in the role they are named in? People change their thinking, move away and even drop out of your lives as the years go by.
Make sure the provisions of the will and trusts direct that the property pass to those individuals and/or charities that reflect your current wishes and the needs and best interests of the beneficiaries. Again, the operational word here is "current". Just as other people change through the years, we do, too. Our thinking today could be radically different than when we did the original plan.
Review the documents and make sure they reflect any major life changes. For instance marriages, births/deaths, major purchases or sales of property or other assets, relocation to another state, buying a property in another state, etc. Have any of these things occurred since you first put together your estate plan?
Check your beneficiary designations. It’s important to check retirement accounts, life insurance policies and other investments that name beneficiaries. We have seen cases where beneficiaries were named during an old marriage and never changed when a divorce occurred, beneficiaries who were deceased, and so on.
Do you have a list of passwords? With the move to do nearly all business online, login information is an important piece of information for an estate plan. Make sure each account has the "username" and the "password".
Where are your documents? Who has them and where are they located? Who did you tell about their location? You can have the finest estate plan known to man but if it can't be found, it's useless.
Do you have a set of advance directives and are they updated as well? Do your directives, such as the health care proxy, living will and power of attorney express your current wishes and authorize your chosen agents to make medical and financial decisions in the event you cannot do so? Are these agents still a part of your life?
And what if you don't have an estate plan?
Then it's time to make one. Many people begin the process but then procrastinate for a number of reasons, perhaps because they want everything to be perfect and are waiting for just "the right moment" or maybe because talking about death is too uncomfortable and becomes a conversation they want to have at a later time. In any case, as the current crisis makes us painfully aware, we never know what may be waiting for us around the corner. If you don’t have one, you can begin planning today. Remember, even a basic plan is better than no plan. You can always update it in the future.
So that lends itself to this question, "why would I want to put together an estate plan or begin transferring assets in this current financial environment?"
That is a fair question, after all, with the stock market in free fall, massive unemployment and even the most conservative planners using the word “depression”, who wants to talk about transferring wealth? Well, just remember this -- all things pass -- as will this current situation. The market will rebound, stores will re-open and America will go back to work. And will you be ready to take advantage of this recovery?
“Some of the more successful estate plans that elder law attorneys developed with clients took advantage of the financial crisis of 2008-2009,” stated Attorney Connelly. “And, there will be many successful estate plans in the future because those people took advantage of the current financial climate, especially with the plethora of investor-friendly actions being taken by Congress to stimulate the economy.”
"If this current situation has shown us anything, it's that none of us know what tomorrow is going to bring," said Connelly. "But, we know what today holds, so begin the process as soon as possible and you will ease some of your anxiety knowing that you have planned ahead."
NOTE: Connelly Law Offices remains open during this pandemic and is conducting business using phone interviews, Skype and Zoom. Emergency office visits can also occur. Our offices are cleaned and disinfected multiple times daily, we have multiple air cleaning devices with HEPA filters operating and social distancing rules are in effect. In addition, the states of Connecticut and Rhode Island have allowed virtual notary services which can be conducted by our financial and legal staff. Call us for more details at 401-724-9400.