Attorney and Financial Advisor Chris Berry discuss Why it’s important to review your Estate Plan annually in this episode of Daily Wisdom.

Estate Attorney and Advisor Chris Berry of Castle Wealth Group answers questions on retirement and estate planning every Wednesday at 1pm. Register via this link or give our office a call at 844-885-4200.

Castle Wealth Group and Christopher Berry help families with estate planning, elder law, retirement planning, and tax planning from their offices in Brighton, Ann Arbor, Livonia, Bloomfield Hills, and Novi.

Castle Wealth Group helps families with their legal, financial, and tax planning for their retirement and legacy.

With the use of legal structures like revocable living trusts, Castle Trusts (asset protection trusts), Chris Berry and Castle Wealth Group can help your family plan, protect, and preserve what is important through their Retirement and Legacy Blueprint Process.

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Episode Transcript

Estate Planning

Hey, this is Chris Berry, and today, we’re going to talk about why it’s important to review your estate plan on an annual basis. And if you like this information, please make sure to subscribe to our YouTube channel.

Christopher Berry is a leading estate attorney and advisor in the area of retirement and legacy planning. He has been featured in publications, such as Forbes, Kiplinger’s, Crain’s, Detroit, and more. He’s the host of the weekly radio show and podcasts, the Chris Berry Show. He’s a national thought leader as it relates to retirement and legacy planning and has authored the Amazon best selling book, The Caregiver’s Legal Guide.

So estate planning, a lot of people think it’s a one and done type transaction. But on the financial side, a lot of times they’re familiar with idea of reviewing your financial investments on a regular basis because things always change. Likewise, when it comes to taxes, you get your taxes done every year. Likewise, with your estate plan, it should be reviewed every year, because there’s a lot of things that can change, some things you may have thought of already, some things you might not think of. So for example, the first thing is laws can change, and laws do change, laws change all the time. Every four years, there might be a new president that gets into office that has his or her own agenda, and so with that understanding that laws do change. For example, here in Michigan, if your estate plan is older than 2020, or actually anywhere, it should be reviewed for changes in the SECURE Act. The SECURE Act changes how retirement accounts are left to the next generation.

And if you have a trust, that trust should be updated to ensure that it has the right language for the SECURE Act. Second, if your estate plan is older than 2012, it needs to be updated for changes in the power of attorney law. Any financial power of attorney that’s older than 2012 is missing key fiduciary language. And if you were to try to rely on that financial power of attorney, without having that key fiduciary financial language that’s now required, a lot of the financial institutions or banks might push back and not allow your loved one to be able to do whatever they need to do on your behalf. Third, if your estate plan is older than 2010, maybe it’s missing language with regards to the Michigan Trust Code that was updated in 2010. If your estate plan is older than 2004, it’s missing key medical information, missing the HIPAA authorization, the release of medical information.

The Need to Re-Assess Your Estate Plan

So that’s the first thing, laws can change. Second, your situation can change. Maybe you’ve had a falling out with one of the kids. Maybe someone you named a server role passed away, and now you need to update who your successor trustee is or who your backup power of attorney. Maybe your assets have changed. Maybe you bought a cottage up north. Maybe you’ve sold a house. Maybe you’ve moved. Maybe you’ve opened up a new bank account. Is that new account? Is that new assets funneling into the trust the way it should be? Quite often, it’s not. This is one of the biggest issues, is people, if they have a trust, it’s not funded properly. And what that means is that you’re going to end up sending your loved ones to probate court to administer your estate. Even though you have a trust, you just did not keep the trust updated with changes and assets.

So again, there’s changes in law, changes in family situation, changes in assets, and then also, we need to look at changes in taxes, the federal estate tax. So back when I started practicing, the estate tax exemption was at less than one million dollars where I think if you had less than $600,000, you pass away, anything more than that $600,000 would be taxed up to 45%, and then very quickly went to a million, and then a million and a half, and then three and a half million, and then five million. Now, as I’m recording this today for an individual, if you have less than $11 million , you owe zero in estate taxes. Well, guess what? We had a change in presidency and he wants to repeal the Tax Cuts and Jobs Act, which means that $11 million exemption is going to come down to five million, and then he’s proposed lowering it even further to three and a half million.

Now, it’s a good problem to have if you have more than that, but understand that now, you need to think about federal estate taxes and how that’s going to come into play with regards to your estate plan. So just like you do your taxes every year, you’re revering your investments and financial plan hopefully, maybe twice a year, at least, likewise, you should review your estate plan. So those are the reasons why estate planning is not a one and done type deal. Think of an estate plan, it’s kind of like a parachute. You never know when you’re going to need it if you’re flying, but you want to make sure it’s handy. You want to make sure there’s no holes in it. So make sure there’s no holes in your estate plan, make sure to review and update it on an annual basis. This has been Chris Berry with Castle Wealth Group. Thank you so much. Take care.

Castle Wealth Group has clients across the nation and helps families plan, protect, and preserve what is important by creating a retirement and legacy blueprint.