Estate planning can be thought of as a life-long process. A young person may not have much in the way of worldly posessions, but may have particular opinions about who should make the medical and financial decisions for them if they become incapacitated. So a power of Attorney, health Care Directive and basic Will can be signed anytime starting at age 18. Later, you get into a relationship or get married and although you may be leaving everything to your partner or spouse, you wouldn’t want them to have to deal with the hassles of an estate with no Will (including posting a cash bond), so you might make a Will that leaves it all to them and appoints them as Executor with a few backups. After you have children you need a Will that designates their legal guardians (in case your spouse also dies), and if there’s significant assets, you’ll likely want a trust to receive the children’s inheritance (in case your spouse has died).
Things change over time, though. Suppose one of your children is now in their 20s and has become Disabled. That discretionary trust for them may be the wrong trust — they might need their inheritance sheltered in a Supplemental Needs trust now. The kids may be grown up and doing great – perhaps a trust is no longer needed. Or one of your kids may be strung out or on the verge of divorce. If your Will doesn’t leave their share in trust, perhaps it should. And it’s also possible that you are in a high-asset situation and signed a Will with certain Trusts for your spouse that just no longer fit the situation because the estate tax laws have changed, or their health situation has changed. Or you’ve been sued for divorce. Or you want to leave charitable bequests.
Just as there’s no one plan that fits everyone, the plan that was the perfect solution when you were in your thirties may be a bad plan now that you’re in you’re 60’s. Bad plans can result in legal and tax and financial headaches that are avoidable with thoughtful planning. Seemingly complicated plans can sometimes be the simpler and perfect solution, and a ‘simple plan” may not end up simple after all.