What Issues Should I Consider When Reviewing My Estate Planning Documents?

Updated: Nov 9

Estate planning is a critical aspect of the financial planning process. Reviewing a client’s documents is an important exercise, both at the outset and throughout the relationship. However, this can be a daunting task for both clients and advisors, who may find the exercise tedious and, perhaps, confusing.


To help guide our document review, we have created this checklist. It covers key considerations regarding the most common estate planning documents, including:

  • Wills

  • Living Trusts

  • Irrevocable Trusts

  • Powers of Attorney

  • Living Wills

To pair with this resource, or to guide a more general discussion with clients, please see our “What Issues Should I Consider Before I Update My Estate Plan?” checklist.


Transcript:

Hi, Todd Pouliot, Gateway Financial, visit us at mygatewaymoney.com. I appreciate y'all coming back for another flowchart. This is – or is a checklist, but I want to remind you there's a secondary version of this called, “What Issues Should I Consider Before I Update my Estate Plan.” That’s another checklist I want to advise you to visit after you're done doing this video. So, estate planning is a critical aspect of the financial planning process. And, reviewing a client's document is an important exercise both at the outset and throughout the advisory relationship. However, this can be a very daunting task for both the client and us as the advisor. And, the exercise can be tedious and, perhaps, confusing. So, I wanted to share with you this checklist that's going to cover some major areas that we want to review. We're fortunate enough now, in this new technology age, that we can work with our clients on estate plans, and utilizing some questionnaires can answer a lot of this upfront and make sure you have a very good estate plan. So, the areas we’re going to cover today are Wills, Living trust, Revocable Trust, Power of Attorney, and Living Wills. And, as always, we’re going to share our screen with you here and show you what we're talking about. Certain issues that we want to start out with are threshold issues. Have you recently changed residency? Ensure you have established your domicile, your legal home wherever you change residency, and that your estate plan is valid underneath those – that new domicile, wherever you're going to be living. And, do you need to review the applicable laws and change any of those? So, state or federal, and how your plan may be affected. And, there's the location of your original documents. Make sure you know that the documents are kept in a safe but accessible place known to your family or your fiduciaries. One of the nice things we do is, we have a client vault for all of our clients to upload those that give them an access area for all of the people who may be named and may need access for that. So, general powers of attorney. Do you need to confirm the terms of your general POA, power of attorney, and whether or not it's immediate or springing? It's contingent upon the occurrence of a factor, such as incapacity, and what they are durable. Will they continue beyond your incapacity? Those are very good instructions to have spelled out before any of those things happen. Do you need to review your appointed agents? This is a topic I love to speak about. If you name multiple agents, you could have a different agent for health care and then on your will and so forth. Whether they may act individually or must act jointly, understand the complexities that can arise when agents must act together and consider naming individual agents under current general POAs if convenience is a priority, and confirm that your successor agents are good back-ups for your primary agents. If you have a financial POA, make sure they understand financial issues. If you have a healthcare POA, make sure they understand healthcare issues, and sometimes that's not the same person. For me, it's not the same person and that's why I bring that to light. I want to have somebody that's going to be on my healthcare directive to understand healthcare terminology and what the situation is. And, on the financial side, somebody that understands finances. So, they may not be the same person and just naming the firstborn may not be the right thing to do. If you have somebody that has a healthcare background, or somebody that might have some sort of financial background. Do you want to limit your agent’s powers? Is there a good reason to record your general POAs? And, have you revoked any prior POAs? Consider appropriate steps to prevent an unauthorized action by your prior agents. In some cases, recording may be advisable or necessary. On to healthcare. Do you need to review your appointed agents? Given the nature of this role, local or readily available agents may best serve your needs. This is very important if you’ve decided to move to a different state and your healthcare agent is a child who still resides in the prior State. They may not be readily available to best suit your needs. Make sure you understand that. These are things that come into play. If you named multiple agents, again there may be potential for inefficiencies and disputes among co-agents. That's why you might want to detail what your wishes are. Before you do that, we have a nice little tool called “Five wishes” that states exactly what your wishes are before you do need them. And, make sure that you have contingents or successor agents that are good back-ups for your primary agents. Any health procedures that you may be undergoing? Healthcare POA form in addition to what you might have in place. And, do you need to review your healthcare POA to confirm your HIPAA authorizations? Be very careful with that HIPAA authorization and make sure you have those in alignment prior to any health care procedure you have. And, confirm that you've clearly expressed your wishes regarding your end-of-life treatment options. Make sure it's clear. Artificial nutrition and hydration and palliative care. Make sure those things are clearly spelled out with what you want prior and that will alleviate pressure on your healthcare POA. Very important to have all these things listed out prior to an issue. Last will and testament. Do you need to review your executor or personal representative appointments and successors? Confirm, that they're qualified to serve under your state law and consider whether they're capable of fulfilling their duties. If you named co-fiduciary, weigh the benefits against those possible complications. And, importantly, do you have minor children? Confirm you have included trust provisions. For example, in a testamentary trust or any living trust, to control the timing and access to funds and properly support and protect your children. Onto the second page. Name one or more guardians. And, when naming a married couple as guardians, consider whether divorce or death of one party would affect their suitability. These are things to think about prior to naming those agents. Or, after you have named them, do I need to update those names? If you hold testamentary powers of appointment, will you properly exercise them under your will? Do you need to review the allocation of the estate or inheritance tax burden? Digital assets. We talk a lot about a book that I had my clients, “In Case You Get Hit by a Bus.” And, digital assets are extremely difficult issues to deal with, especially for the elderly because the world has changed. You didn't need to have all these logins and passwords. Make sure those are readily available and we definitely go through that with our clients in that book and we just talk about, how we help. Your life should be a mystery, but it should be easy to solve. Does your will refer to a tangible personal property memo? Complete the memo according to your wishes on the tangible property and where those things need to end up. Revocable living trusts, they’re different than irrevocable. So, do you need to review your trustee or co-trustee appointments? Again, make sure they're qualified under your state law and make sure they're capable of fulfilling the duties. Also the costs and benefits of appointing a corporate fiduciary. There is excessive cost with that should you not have an able-bodied person that is able to handle all those issues that are capable of fulfilling those duties. And, do you have beneficiaries with special needs? These are big important topics. Do you need to review the allocation of the estate or inheritance tax burden for assets passing under your trust? Does your Will pour over into your trust? Do you need to fund your trust during your lifetime? Do you need to fund it? These are good questions to ask. How is that trust going to be handled? Convey your trust and whether the trust-owned assets will avoid probate that your death. I know a lot of people are concerned about probate and how that works. Make sure you title your beneficiaries properly not title them into a trust if that's not what you want. So, that's revocable on the other side we have irrevocable. Do you have an ILIT that the trustee is properly administering the trust? All premiums are properly paid and any Crummy notices are timely issued if they're applicable. The irrevocable life insurance trust, it’s a great planning tool to have. And also, these are great – the split-interest trust CRT, charitable remainder trust – charitable lead trust. Confirm that they are properly administering the trust and annual payments are properly calculated and made. Do you have GRATs or SLATs? Again, make sure they're done. Do not risk inclusion in your taxable estate. Other sorts of irrevocable trusts, rent back of the residence, and observant proper formalities. Big big big stuff that can cause a lot of trouble later on if you do not name them properly. Confirm income tax returns are properly filed for your irrevocable trust. And, are your actions consistent with the terms of your trust? These are very important things to figure out because again, irrevocable we want to make sure those are done properly at the right time upfront. Miscellaneous, if you have a premarital agreement. Do you need to ensure that your estate plan is in alignment? Please make sure you are putting them into alignment – that they do not disagree. And, review your non-probate transfers to ensure that they align with planning under your will and trust. This is one of the things that we do. We talked a lot about TOD and POD, transfer on death, or payable on death. If they’re jointly owned or TOD or POD and pass by survivorship. Review deeds and account titling to ensure alignment with your overall plan. This is something we want to talk about a lot. Make sure they're done right and follow up and review them – annually is good – at least biannually. Retirement accounts, life insurance policies, annuities, etcetera pass by beneficiary designation. You can also choose to disclaim. The beneficiary can disclaim the inheritance. And, confirm the status of your beneficiary designations with each institution. That's what I love about our software we can go through each line and say, who is the primary, who is the contingent, how was it titled, TOD, POD, how do we have these things in alignment, and make sure that we have this flowchart afterward that shows us the estate plan after you're gone. Creating an estate plan is one thing, administering it is very different and some people don't know how to do that. Make sure you have that all set up and make sure you’re working with somebody that has those workflows that'll take care of that. And then, this is a great one, do you need to add flexibility to your plan by designating a trust protector to allow changes, should unforeseen circumstances arise in the future and are you concerned about the future will or trust contest? Be very careful in naming all those things properly. So, we appreciate you coming back time and time again. Again, our subscribers – thank you so much, we appreciate you, and also don't forget that thumbs-up button. It helps with the algorithm here on YouTube and we hope we're providing you with great information. Again, one last thing I did want to remind you of, is that this checklist is also in association with the other checklist that we have for the video, “What Issues Should I Consider Before I Update my Estate Plan.” Estate planning is something that people don't want to do. It is something you should do and what we do at Gateway Financial. All this work that we do, can mean nothing if you don't have the proper estate plan set up, to begin with. So, we appreciate you, subscribers. Make sure your ring that bell to get notified of new videos and we keep coming back and bringing you more and more information we hope you're getting educated by this and I hope you all have a wonderful day and be well.

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