By Jeffrey Condon, ESQ, Author, "The Living Trust Advisor"

A Living Trust is your after-death power of attorney. In it you appoint someone-your after-death agent-to sign your name to all the documents that are needed to transfer your assets after your death, such as the deed to your house. Your after-death agent will transfer assets to the persons you have named in your Living Trust as the beneficiaries of those assets.

A Living Trust provides that you and your spouse have the power to amend it at any time. With a Living Trust, which is like a will in that it contains inheritance instructions, you can change, delete or restate any of its provisions by signing an amendment.

Why would you amend your Living Trust? Actually the question should be why wouldn't you amend your Living Trust?

Estate Planning by Lifecycle

If you establish your Living Trust in your 40s or 50s, you are still in the productive prime of your life, your children are young and your financial picture occasionally becomes redrawn. Your Living Trust will speak to your life at that time, with provisions that deal with the management of your children's inheritance if you die prematurely while they are minors.

Then, when you are in your 60s or 70s, your children are grown and your financial picture becomes a bit more permanent. Along with these life changes come new provisions in your Living Trust that deal with minimizing the estate tax and protecting your children's inheritance from any risks of loss in their lives that you perceive (e.g, divorce, addictions, financial immaturity).

Finally, when you are in your 80s and 90s and your life expectancy can be measured in single digits, now it's for real. Your financial picture is set and you know how much estate tax planning must be done. You know who your children have become, and you have the information you need to make informed decisions on how and when they should receive their inheritances. You have grandchildren who are precious to you whom you want to include as beneficiaries to help them to get a leg up in life to buy that home, begin that business and start that family. Once more you amend you Living Trust to accommodate those changes.

Common Living Trust Changes

There are amendments to Living Trust that are not so sweeping. Whereas many of your changes will involve a complete rewrite of the document, such as those which address the changes in your family and finances just described, many more will address only one or two issues. The amendments to a Living Trust that are the most common include:

• An amendment to change the person who serves as your life-time agent in the event of your incapacity.
• An amendment to change the persons who serve as your after-death agent.
• An amendment to add or delete specific bequests of cash or other assets.
• An amendment to delete a specific gift of an item after you no longer own that item.
• An amendment to disinherit a child or grandchild.

The most common amendment is one that changes the disposition of personal property such as clothes, furniture, jewelry, antiques, automobiles and collections to another person. Most of these changes are "I will show you" changes, as in "You disagree with me, I will show you not to disagree with me."

However such changes are a waste of money and time. For all the amendments that deal with personal property, I could spend the same time focusing on more intellectually challenging amendments that completely restate an entire Living Trust.

(This article was adapted from "The Living Trust Advisor" published by Wiley)