Is your trust up to date? Many people create trusts and forget about them. While they are an incredibly powerful estate planning tool, trusts need regular maintenance to remain effective.
Circumstances can change over time, and your outdated trust may no longer accurately reflect your wishes or comply with current laws.
Updating your trust is important
Outdated trusts often carry more risks than benefits, such as:
- Changes in family dynamics: Marriage, divorce, birth or death of beneficiaries can render your trust obsolete.
- Changes in assets: Acquisition or sale of properties, businesses or investments may require updates to your trust.
- Changes in laws: Changes in tax, probate and other regulations may warrant modification of your trust.
- Incapacity or death: If the settlor (the one who created the trust) becomes incapacitated or passes away, an outdated trust can lead to confusion and disputes.
Failing to update your trust can result in lengthy and costly legal battles, unwanted tax liabilities and conflict among beneficiaries. Resolving these issues can be more expensive than taking proactive steps to ensure your wishes still serve their purpose.
Do not risk your hard-earned assets and peace of mind
How do you know if your trust has outgrown its usefulness? Generally, it may be time to take action if it has not undergone a review in over five years, if there’s a major change in life or financial situation, or if you have moved to a different state.
But can you repair a broken trust? In most cases, yes. Depending on the issues, an experienced attorney can help you amend, restate, or even completely revoke or replace them.
