Entrepreneurs are some of the most motivated and focused people in Washington. Most also understand that an estate plan is an essential part of their success, as carefully constructed wills and trusts can protect a person’s assets even after death. Unfortunately, estate planning once is not enough — a plan must also be regularly updated.
A recent survey revealed that about 90 percent of successful entrepreneurs have created an estate plan. The survey only defined an estate plan as having at the very least a will, so it is unclear what percentage of those surveyed had more complete plans. While even a basic estate plan is a good place to start, it is not necessarily much help if it is out-of-date. That same survey found that 85 percent of the successful entrepreneurs’ estate plans had not been updated in at least five years.
Tax laws are constantly changing, and entrepreneurs must be able to change to remain successful. This ability to adapt should also be applied to estate planning, where changing tax laws can completely throw off a person’s plans. Any plan older than five years old is much more likely to miss taking full advantage of all available estate tax opportunities. This is especially true for those who have increased their overall wealth since going into business for themselves.
A significant number of entrepreneurs in Washington are likely going through life without an updated estate plan. This is true even for those who have experienced significant life changes, such as divorce or the birth of a child. To truly protect business interests, personal assets and to ease the burden on loved ones, entrepreneurs should be sure to conduct an annual review of all estate planning documents, making updates as needed.
Source: Forbes, “Most Successful Entrepreneurs Have Out Of Date Estate Plans“, Russ Alan Prince, Oct. 9, 2017