Haven’t Updated Your Estate Plan in a While? It’s time

From the Wall Street Journal – Many people wait until it’s too late, and leave a mess to their heirs.

WALL STREET JOURNAL July 26, 2017    Financial adviser Bijan Golkar begged his father to update his estate plan after his father divorced and purchased significant business and real-estate holdings. But despite his cajoling, his father wouldn’t take action. When the dad died three years ago at age 59, he left behind a seven-figure estate, a 15-year-old estate plan and a huge mess for his three sons to clean up.

Because the father initially wrote the estate plan when he was married, it was not valid at the time of his death. This automatically sent the estate through the probate-court process, leaving the sons at the mercy of the court with respect to timing and ultimate disposition.

“As an adviser, I’m used to some people dragging their feet on this, but in the end they get it done. My own father, I couldn’t get him to do it,” says Mr. Golkar, a certified financial planner and chief executive of FPC Investment Advisory Inc. in Petaluma, Calif.

Many baby boomers are in the same precarious position as Mr. Golkar’s father was. They first tended to their estate plans many years ago—often after the birth of their first child. Now it is 15, 20 or even 30 years later and they haven’t revisited critical documents, including wills, trusts, powers of attorney, advance directives and living wills. Some have simply forgotten about them, while others are perpetual procrastinators or prefer not to revisit these difficult discussions.

This means that they haven’t accounted for significant changes—like remarriage, divorce, or the purchase or sale of a business, expensive art or real estate. All of these events, along with meaningful changes in estate-tax laws and state rules related to wills and trusts, can have major financial and emotional implications for heirs, says Jared Feldman, a partner in the private client group of accounting firm Anchin, Block & Anchin LLP.

“Trying to fix things after the fact becomes much more complicated and some of the fixtures can’t even be unwound,” Mr. Feldman says.