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When and How Often to Review Trusts


You don't necessarily create a trust and just forget about it. You may revise a revocable trust whenever your circumstances change. Perhaps you want to add a beneficiary. A trust can be revoked or amended at any time as long as you, its creator, are mentally competent. Having an updated trust will reduce the chances that your property will pass through probate.

Common assets placed into a trust include your home, bank accounts and stocks. With a revocable trust, you name yourself as the trustee to remain in control of your assets. When you die, your trust becomes irrevocable and is transferred to a designated beneficiary.

Any of the following may impact your trust:

  • You have more kids or grandkids.
  • As your progeny age, you get to know them better and you may want to change distributions.
  • You become newly married or divorced.
  • You change residency status — moving to another state or country, for example.
  • There's a change in financial status, such as a substantial increase in net worth.
  • You buy property that needs to be added to a trust.
  • You refinance a loan that involves property held in a trust.
  • A trustee or beneficiary expires.
  • One of your trustees becomes seriously ill.
  • Your executor or trustee no longer wishes to serve in this capacity.
  • New tax laws are passed that impact trust assets.
  • You retire.

It makes sense that you will want to address revisions to your trust to reflect domestic matters. Generally, financial advisors counsel scheduling an update every three to five years, with an additional look at your trust's schedule of assets every five years. After all, laws change all the time.

Another way to look at revisions? A new year is a good opportunity to reflect on any significant changes in your life and to determine whether your plan still meets all your goals. Time passes, and it's easy to put your plan in a safety-deposit box and forget it.

Although the hard part of setting up a plan is done, it's a mistake to file it away and forget about it. Although your plan is drafted, there will be changes that may lead to adjustments in your estate plan, including acquiring or removing assets.

Estate planning is an important task that everyone should give proper consideration. You should review your trust as your financial life, your family situation and laws change. If you care about your finances, stay current. You even may want to redo your trust entirely.


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Kim & Lee
Kim & Lee, LLP
2305 W. 190th St. Suite 100
Torrance, CA 90504
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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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