Signs Your Trust Could Be in Trouble

Many people who establish a trust don’t take the time to revisit their plan every few years. This is a big mistake. While reviewing your trust can be a daunting and tedious process, it’s necessary. If you neglect to revisit your plan once it’s been drafted, it could affect how your assets are distributed down the line. With that being said, here are a few signs your trust could be in trouble.

You Haven’t Updated Your Beneficiaries Since the Trust Was Drafted
It’s necessary for many people to update their beneficiaries at least once after they’ve drafted a trust. For example, you may have had new children or grandchildren since you’ve first established your trust and want to add them to it. You might also want to remove someone from your trust, such as an ex-spouse or a recently estranged family member.

You Haven’t Reviewed Your Life Insurance Policies in Years
If you haven’t looked at your life insurance policies since they’ve been executed, you’re not alone. However, not reviewing your life insurance policies periodically could lead to issues later on. You might find out that your policy isn’t properly funded or it has lapsed.

You’ve Moved and Haven’t Updated Your Trust
Whenever you move to a new state, it’s important to revisit your trust and other estate planning documents. Not all states have the same laws that govern estate planning. If you move to a new state without updating your trust, your trust may not be valid in your current state. It’s in your best interest to have an estate planning lawyer who has knowledge of your specific state’s law revise your trust.

You Haven’t Specified Who Will Receive Your Personal Items
When you’re deciding which family members will get what, you can’t just think of your home and investment accounts. You also have to consider who you want to receive your personal items, like jewelry, furniture and family heirlooms. If you don’t specify in your trust who you want to receive these items, it will just add more stress to your family members. They will have to decide how to divide these personal items and may get into arguments over them.

You Appointed a Family Member or Friend as Trustee
Initially, it may seem like a good idea to name a close family member or friend as your trustee. You trust this person and believe he or she will do a good job. However, the average person doesn’t truly know about the responsibilities that come with being a trustee and may become very overwhelmed. That’s why it’s better to appoint a bank or trust company as your trustee.

If you need to update your trust, contact an estate planning lawyer, like a probate lawyer in Folsom, CA, today.

Thank you to Yee Law Group, PC for their insight into creating a trust.