Estate planning is not something you can set and forget. It is not likely that the first estate plan you ever create will anticipate all of the changes in your family, income, and assets that will occur in the years to come. Prevailing wisdom advises a thorough review of your estate planning documents after significant life events such as marriage, birth, divorce, and death. However, there are plenty of changes that occur annually that could also impact your estate planning. Here are the top three things you should review in your estate plan every year to make sure your legacy and assets are protected and distributed per your intentions.

1. Review Your Beneficiaries and Fiduciaries

On an annual basis, we recommend that you consider whether your named beneficiaries and fiduciaries are still appropriate. Fiduciaries like executors, agents under powers of attorney, and trustees are tasked with great responsibility. Look at who you previously named and evaluate whether they are up to the task or if someone else would be a better choice.

Your designated beneficiaries are those named to receive certain assets at your death, such as life insurance and retirement accounts. These designations are not controlled by the terms of your will or trust agreements and instead pass directly to the named beneficiary(ies) regardless of the status of their relationship with you. For example, a divorce will not automatically revoke an existing designation to your former spouse. As such, it is imperative that you check the status of each beneficiary designation that you may have for each account and/or policy. You should also review the contingent beneficiaries, as well, to be sure that they reflect your current wishes.

2. Revisit Your Insurance and Investments

It is also a good idea to review your existing insurance coverages upon renewal: life, homeowners, umbrella, disability, long-term care, etc. Over the course of a year, your assets and liabilities may have changed, which in turn affects your liability exposure. Determine if your current policies need increased coverage or if a reduction in coverage is warranted.

It is also important to review your investments and your investment advisors. Consider how your accounts are performing and how much you are paying in fees.  Confirm that your investment advisor is held to a fiduciary standard, rather than the less-stringent suitability standard. This means that your investment advisor must put your interests above their own, following the very best course of action, regardless of how it affects their compensation.

3. Evaluate the Tax Implications

Lastly, a good estate plan is tax efficient. Reviewing your assets and estate plan annually is important as tax laws and applicable exemption amounts change often. Talk with your estate planning professionals about the potential advantages of lifetime gifts, of granting powers of appointment to beneficiaries, of funding existing trusts, and other more complex strategies.

Income and estate tax planning is also important as it relates to your domicile. The location of your primary residence and how much time you spend there is only one factor in how and where you are taxed.

Getting advice and guidance you can trust is the number one thing you can do to protect your estate and provide for your loved ones. Meet with your estate planning attorney and financial professionals to discuss your options. Experienced trusts and estates attorneys can help you understand your assets, the laws applicable to their transfer, and can help you prepare or update your existing plans to ensure they reflect your wishes.

Follow Hinckley Allen on LinkedIn and Twitter for the latest news and updates.