It is natural to expect that named beneficiaries, or a designated attorney in fact will outlive you, but as everyone knows all too well, things rarely go according to plan. However, just because an unexpected death may occur, it doesn’t need to throw a wrench in your estate planning documents. One way to get around this problem is to name alternate beneficiaries or agents for powers of attorney.
In the case of a will, naming an alternate beneficiary is important so your wishes are clear in the event an heir predeceases you. It is important your wishes are clear so the person handling your estate (“the personal representative”) can properly administer your estate. For example, it is common for someone to leave all their property to their surviving spouse. However, in the event the other spouse does not outlive them, naming an alternate beneficiary, such as a brother, or children from another marriage, makes clear the intended distribution.
It is possible to take this a step further, and name additional beneficiaries assuming a brother or children from another marriage pass away first. For instance a will could name an aunt or an uncle to further clarify how the property should be distributed. Just as naming alternate beneficiaries is a good idea, it is also a good idea to name alternate personal representatives to administer your estate. Although Arizona Revised Statute § 14-3203 sets forth the priority of appointment of a personal representative, naming an alternate or two is a good idea to ensure your estate is not administered by someone you didn’t intend to administer it.
Naming an alternate for your power of attorney is also important. Your power of attorney will be able to make health care or financial decisions for you in the event you are unable to make them for yourself. If the person designated to make these decisions passes away, and you later become incapacitated, who will make these decisions for you? Often times this can lead to the need for a guardianship and/conservatorship so the court can appoint someone to make those decisions. This can be a costly and lengthy process. For more information on this process see our previous Blog on How to Get a Conservatorship for an Adult or How to get a Guardianship for an adult.
In addition to naming an alternates, it is just as important to keep your documents up to date. Estate planning documents should be updated periodically to make sure there have been no relevant changes in the law. Other life events might include the death of an heir as discussed above, a divorce, a marriage, the death of a spouse, having a child, or move to a different state. Although your documents may already contain alternates, it is still important to have them looked and potentially rewritten to include new alternates.
In addition to having a will, some people also have a trust as part of their estate plan. A trust can also be amended for the reasons listed above. Additionally, you may want to amend a will or a trust if there is a significant change in your financial situation. This could be starting a new business, winning the lottery, buying property or any number of other changes.
If you have had recent changes in your life, or if it’s just been awhile since your estate plan was reviewed. Contact our office today to set up a free initial consultation with a knowledgeable estate planning attorney to help you determine if amending your estate planning documents is necessary.