Bigger Than a Texas Tornado
It has been said that the butterfly effect is the cumulative result of small natural forces produced over time in one place that later results in larger changes elsewhere. A common illustration of this phenomena is the tiny butterfly flapping its wings in Singapore that eventually causes a tornado in Texas. Similarly, when you took the initiative to create your trust, you took a small but very important step in planning for your family’s financial growth and solidarity in the future. However, you and your family may experience large unwanted effects in the future if you fail to maintain your trust properly, and your beneficiaries may experience a Texas-sized tornado down the road when it comes to trust distributions.
Good Habits Are Important
When was the last time that you gave your trust a thorough once-over? We recommend marking your calendar at select points throughout the year to revisit your trust and talk with someone close to you about future events and conditions that may affect the purpose of your trust. Take a moment, pull out your trust portfolio and review it. As you go through your estate plan, consider the following good-habit thought points:
- When was the last time that you updated your living trust? Circumstances may have changed. You may have started or sold a business, changed careers, moved to a new state, gotten married or divorced, had children, lost loved ones, or simply changed your mind about how you wish to provide for those close to you. If any major life events have happened, we strongly urge you to consider updating your documents as soon as possible.
- Who did you name as trustee and successor trustees? Are they still willing and capable to carry out their duties? Have they kept up with changes in the laws? Or, have financial circumstances changed which may require you to bring in additional parties to help manage your affairs like a co-trustee, trust advisor, professional trustee, and/or trust protector?
- Do you have adequate insurance? Many folks do not have enough insurance for themselves or their businesses. They also fail to name contingent beneficiaries. If you have not done so already, we recommend getting your insurance policies in order.
- How is your recordkeeping? Even though you have a trustee to handle your trust, it is important that you stay apprised of your finances as well as the performance of any investments in your trust. Keep your track of your records and store them in a safe place.
Remember
Trusts are living, breathing creations like butterflies. Your life can and will change due to many of the circumstances mentioned above as well as other unanticipated personal life events. Also, external events, such as tax legislation passed in your state or the development of a novel financial instrument, can frustrate your trust or open the door for incredible opportunities. Be honest with yourself and your goals. If you find that you struggle with any of the good habit thought points above, it may be time for you to meet with an estate planning attorney to update your approach.
Contact Us Today
Contact The Ledbetter Law Firm, APC today to schedule a meeting with one of our estate planning attorneys. Whether you are thinking about creating a trust and would like a free consultation, or if you simply require a routine checkup of your living trust or estate plan, we’ve got you covered. Our team of skilled estate planning attorneys can help you develop strategies to avoid unintended financial pitfalls in the future; as well as help you stay informed of changes in the law so that you feel more at ease with the decisions you need to make. At the Ledbetter Law Firm, APC, we value your business and look forward to serving you every step of the way.