Have You Outgrown Your Estate Plan?

Think back ten years. A lot has changed in your life during the past decade, hasn't it? Maybe you've gotten married, had kids, bought a house, acquired a few other assets - whatever the events have been, your personal circumstances are probably not what they were 10 years ago. Your financial needs change throughout your life as well. What was important to you at age 25 may not matter at all by the time you hit 50. The priorities of middle age wouldn't even have entered your mind back then. And your personal and estate planning strategies should change right along with those life stages.

Estate Planning for the 20- and 30-Somethings

During your 20s and 30s, you're building your career, starting a family, and beginning to acquire assets. Your estate planning for this phase of your life should address the following issues:

• Make sure you have adequate disability and life insurance coverage to meet your family's needs if you were to die, or if you had an accident and were unable to work for a prolonged period of time.

• Meet with an investment advisor to discuss retirement investment savings plans, education funds for your kids, and other strategies which allow you to save for the future while receiving the immediate tax benefits of your contributions.

• Decide how you want your assets distributed among your surviving family members, upon your death.

• Name a guardian for your minor children, who will raise and care for them if you and your spouse were both to die.

• Set up a trust to provide for your dependents and select an executor / trustee who is able and willing to administer that trust until your children reach adulthood, or - in the case of a disabled child / dependent - during the lifetime of that disabled dependent.

Updating Your Estate Plan for Middle Age

By the time you get to your 40s and 50s, you have a whole new set of concerns. The kids are starting college, or setting out on their career path, maybe even having kids of their own. You want to help them out financially as much as you can. Your parents are aging and may be developing significant health problems, and you may be facing your own health issues. Maybe you've gone through a divorce or separation, which is another good reason to re-evaluate your estate plan. Maybe you want to buy a vacation property, or travel extensively, or retire early.

It's time to re-assess your estate plan to make sure it addresses those issues and that it can help you meet your financial goals. Sit down with your lawyer and your financial advisor, and go over your will and any trusts you have already set up, and review your insurance coverage and your investment portfolio.

An Estate Plan for Seniors

By the time you hit 60, you're either retired, semi-retired, or thinking about retirement, and wondering whether you'll have enough income from pensions and retirement savings plans to live comfortably through your golden years. You may have to deal with health problems and medical bills - yours and your spouse's. Now's the time to sit down and go over that estate plan, and consider the following:

• Make a list of all your priorities, needs, and goals for the next five years. Assess your financial situation - both current and future - to determine if you can reasonably afford to cover everything on the list.
• Consider downsizing from your family home to a condo or townhouse. Talk to your financial advisor about the best way to invest or use any profits you make from the sale.
• Ask your financial advisor about the rest of your assets and investments, to determine whether it would be beneficial from a tax standpoint to place them in trust. This might also help you to reduce the costs of probating your estate after your death.
• Review your will, power of attorney, and other estate planning documents with your lawyer. If you haven't made a power of attorney yet, now is the time to do it.