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Winter holidays are a great time to review estate plans

On Behalf of | Nov 28, 2023 | Estate Planning |

The winter holidays represent a time when families in California come together to celebrate good times together. Because of the amount of time you spend with loved ones, winter holidays also represent a prime time to review your estate documents and discuss whether you need to amend or add to them.

Points to consider

Estate planning is not a one-and-done deal. Experts recommend you periodically review all documents to see if they are current. If you have not reviewed your documents in the last three years, the holidays are a great time to do so because you may have more free time that you don’t have the rest of the year. Only one-third of Americans have created estate plans, but many still need to update their documents. For example, you may have created your plan when your children were minors and have guardianship documents but no provisions for leaving assets to your children after they are married. Ask yourself whether you want to add trusts or other means to leave money to married children and their spouses or grandchildren.

The end of the year is a great time to consider gifting assets to reduce your income tax burden. You can give sums of up to $17,000 per person. Another way to help your grandchildren is to contribute to a 529 savings account to help pay for college tuition. If you are looking for other ways to save on your taxes, consider giving to a favorite charity.

The importance of reviewing documents

Asset distribution is one of many points to consider. A thorough estate plan should also contain other essential documents, including a will and a designated executor. You may also want to determine if any revocable trusts that you have in place still meet your wishes. Other crucial documents include powers of attorney for health care and financial affairs with a designated representative in case you cannot speak or make decisions.

One additional document that people sometimes forget is a living will. This document spells out your end-of-life wishes, making decisions easier for your loved ones so they don’t have to guess about what you want when dealing with life support and extensive medical care. If you do not have a living will, it is strongly recommended you get one drafted.