I am often asked when a Will should be changed. The answer is that a change in a Will is primarily triggered by personal circumstances. It is unlikely that there would be such a significant change in law that would require everyone to change his or her Will. Excluding the future federal estate tax uncertainty, most of the circumstances that trigger a change in estate planning documents result from changes in your personal or family life.
1. Marriage or Divorce: In Massachusetts, a marriage or divorce may revoke a part of or the entire Will. If you are getting married, there is special wording than may be inserted into the acknowledgement that will prevent the Will from being revoked. The suggested wording is: “This Will is made in contemplation of my marriage to __________________ and the provisions of this Will shall not be revoked by such marriage.”
A divorce will revoke any distribution to the former spouse. Any property passing to a former spouse will be treated as if the former spouse had predeceased the will-maker. A divorce also revokes any appointment of a former spouse as executor, trustee, guardian, health care agent, or conservator. A separation does not revoke these terms, because the court does not consider a separation to be a legal dissolution of the marriage.
Unless the divorce agreement prohibits, also remember to replace an ex-spouse as the beneficiary on any life insurance policies or retirement accounts. Recently the United States Supreme Court decided whether a waiver, signed by an ex-spouse, in which she gave up her rights to her former husband’s retirement benefits was valid. The Court found that the waiver was not enough to overcome her former husband’s designation, and awarded the benefits to his ex-wife. Kennedy v. Plan Adm’r for DuPont Savings and Investment Plan, 129 S. Ct. 865 (2009) (plan administrator correctly paid $400,000.00 to ex-wife because original designation form was properly done while waiver form was not done within rules governing the plan).
2. Separation or Marital Troubles of a Child: If a child is separated or experiencing marital troubles, it may make sense to redo your Will. In Massachusetts, one of the factors used in determining the division of marital property for a divorcing couple is the “opportunity of each for future acquisition of capital assets and income.” This means the Probate Court Judge deciding the property division of the divorcing couple is allowed to consider the potentialinheritance of both parties.
As long as the parent is alive, the actual inheritance itself is not at risk, but the possibility of an inheritance may be used to calculate division of assets awarded to each spouse. Davidson v. Davidson, 19 Mass. App. Ct. 364, 374-377 (1985) (potential inheritance may be considered by judge as “opportunity of each for future acquisition of capital assets and income” in determining what disposition to make of the property which is subject to division); Zeh v. Zeh, 35 Mass. App. Ct. 260, 264-265 (1993) (“expectancy of an inheritance does not qualify as property subject to division . . . [but may] be considered by the judge under the “criterion of ‘opportunity of each for future acquisition of capital assets and income’ in determining what disposition to make of the property which is subject to division”).
Divorce attorneys are well aware that the court may use a potential inheritance when dividing the marital property. Even though only one of many factors used, a changing a Will, even if only temporary, may make sense.
3. Death of a Spouse: Most Wills already have language that details the distribution of an estate if a spouse has already passed away. However, it is still a good idea to review those terms. In some cases, the Will may have been made decades before, and the terms no longer really reflect the wishes of the surviving spouse.
For example, if the now deceased spouse was named the executor, make sure there is an alternate listed. If a child was named as the alternate executor, are they still the best choice?
4. Spouse in a Nursing Home: When one member of a married couple has to go to a nursing home, the Will of the person remaining at home should be reviewed as soon as possible. Many times couples have “I Love You” Wills. These types of Wills leave everything to the surviving spouse, and are very common – particularly if the Wills were done years earlier. But, if one spouse is now in a nursing home, this is probably not the best distribution plan.
It may be a much better idea to direct that assets be given to a trustee of a trust used for the benefit of the surviving spouse. The Trustee will then be able to control and manage the money for the surviving spouse, and if the trust is properly drafted, the assets may be protected from the cost of nursing home care. To take full advantage of a testamentary trust (a trust created in a Will), the assets must be only in the name of the spouse living at home. Remember, jointly owned assets are not controlled by the terms in a Will. “Joint Ownership Is Not An Estate Plan”