You need to update your document if your life or the law has changed since you signed your last will and testament (will) or trust agreement. You can make updates to a revocable living trust by way of an amendment or a complete restatement of the trust agreement. An amendment updates a specific part of the trust, whereas a restatement creates a new set of operating instructions for the entire trust. You might think an amendment would cost less than a restatement, but that is not necessarily true. You can make small changes or updates with a codicil if you have a will. You also have the option to create a new will with new instructions.
Make the Small Changes or Start Over with a New Document?
Imagine a recipe card you have used for years. The card may still be readable if you have crossed out and replaced one or two ingredients. However, the recipe is probably confusing if you have altered the ingredients many times. If your loved ones cannot read your instructions to determine whether to add a cup of flour or a cup of sugar, your recipe will not work. You have a fifty-fifty chance for a great dish – or a complete disaster.
The same can be said about a will or revocable living trust. Making one or two changes to a document is generally acceptable, but your instructions may become confusing when revisions are numerous or comprehensive. The primary reason for the confusion is that the old document and any new documents must be read together to understand the full instructions. For this reason, starting over with a new will or a complete restatement may serve you better.
Although codicils and amendments are generally used to make small changes, and new wills or restatements are used for large ones, there is no bright-line rule for making changes to your will or trust. A general guideline is that anytime you are making more than two changes, creating a new will or restatement is probably better because it
- fosters ease of understanding and administration;
- tends to avoid ambiguity;
- reduces the amount of paperwork to retain and provide to financial institutions or parties;
- decreases the risk of misplacement;
- prevents beneficiaries from discovering prior terms; and
- provides an opportunity to include other relevant updates, such as changes in the law.
In many cases, a restatement may be even more cost-effective than amendments. This is especially true today because computer software allows estate planning attorneys to quickly and efficiently create and retain documents. Fortunately, you pay for legal counseling, not typing.
Have Questions about Updating Your Estate Plan? We Have Answers
Before deciding whether to make a small change or create a new will or a trust restatement, it is essential to determine whether previous changes have inadvertently altered your intent or adversely affected the will’s or trust’s administration. We will help make your instructions clear.
Do you have questions? If so, that is normal. We can provide you with answers. Whatever your circumstances, rest assured that we can help you determine the best way to update your will or trust.
At Cheever Law, APC, we don’t just draft documents; we ensure you make informed and empowered decisions about life and death for yourself and the people you love, starting with a valuable and educational Family Wealth Planning Session. The Life & Legacy Planning Session will allow you to get more financially organized than ever before and make all the best choices for the people you love. If you have already completed your estate plan, we will review that plan at your Life & Legacy Planning Session (aka Family Wealth Planning Session) to ensure that it will work the way you intend and address any holes or gaps that may be present if circumstances have changed since you executed your plan.
To learn more about our one-of-a-kind systems and services, contact us or schedule a 15-minute introductory call today.