Trusts are on the rise in California. Given the concentration of wealth in various areas of the state, there is no shortage of high profile, high net worth individuals who would rather keep their personal affairs private and as far from probate court as possible. However, trusts are not just for mid- and high-wealth individuals and families. Anyone with assets over the small estate limit ($208,850 in 2026) or real property valued over $750,000 may benefit from creating a trust as well as anyone who wants to be able to plan for the use of their assets during their lifetime and any period of incapacity, not just designate beneficiaries to inherit their assets after death.
But a trust is not a set-it-and-forget-it proposition. Under what circumstances should a trustor make changes? Attorney Jubilee Menzies, Managing Associate in Trusts & Estates at Laughlin Legal Divorce & Family Law Group in the Bay Area, has the answer to that question and many more.
Q When to review a trust for updates?
JUBILEE MENZIES Every 3 to 5 years is what we typically recommend for routine estate planning purposes since so many people experience changes in their lives without thinking about updating their trust. Regular reviews are the safest option. If your life is fairly stable, we take a look every three to five years to make sure that your estate plan still reflects your goals, names individuals who are still actively in your life to act during an emergency or period of incapacity, and things are where you need them to be. However, there are common significant life events that call for an update to your trust and estate plan, sometimes in advance of the event and sometimes as soon as possible after the event occurred.
Q Update your trust after a change in your marital status-marriage or divorce.
JUBILEE MENZIES You should always review your estate plan and trust if you have a change in marital status. If you’ve gotten married, become a registered domestic partner with the state of California, or gotten divorced, that definitely requires taking another look at your trust.
If you’re in the midst of a divorce, though you have to be careful about making changes. Many couples don’t realize that the considerations for your trust are significantly different during a divorce versus after a divorce. In fact, California puts in place automatic temporary restraining orders once a marital dissolution is filed. So, for instance, you can’t go and disinherit your spouse from jointly owned assets during a period of time in which you both are trying to disentangle yourselves and separate assets. But what you can do during the divorce process is update your incapacity planning documents and consider disposition of separate property, not community property.
For example, you can change who your agent is under a healthcare directive, so that spouse you’re trying to divorce isn’t the one making medical or end of life decisions if you’ve become incapacitated and need medical care. Instead, you can name someone else – a sibling, a parent, a close friend – and that doesn’t alter anything about your finances during divorce.
And then after the divorce is finalized and asset allocation is completed, then you want to have a trust that properly reflects your marital status. Get an individual trust and individual estate plan that reflects the beneficiaries that you want to benefit from your individual estate, and the people you would choose to manage your affairs if you were incapacitated.
Q Why do you need to update your trust after marriage?
JUBILEE MENZIES California is a community property state. If you and your spouse don’t have a prenuptial or postnuptial agreement, then your assets are going to be characterized according to the state law in place. And under California law, assets acquired during marriage, with a few exceptions, are community property, so they’re equally owned by the couple 50/50 regardless of who earned those assets. Community property cannot be funded into a separate property trust in California. And by the way, the same ownership principal is generally true of debts or liabilities acquired during the marriage. They’re also typically owned and divided 50/50.
So you need to make sure that your trust takes into consideration things like the nature of the assets or debts that are community property vs. separate property, whether you and your spouse have differing beneficiaries you’d want to benefit if you were to pass away (like the siblings of each spouse), and whether you want the trust to remain very flexible after the death of the first spouse or whether you want to lock certain beneficiaries in place upon the first death. People very commonly name their spouse as the person who would inherit their estate, but there are additional considerations for how to do that, and so you want to make sure that’s all in order.
Q Should you do a trust update after remarriage?
JUBILEE MENZIES Almost certainly, especially if you don’t have a prenup or postnup. The same essential considerations apply to remarriage that apply to any marriage; however, there are often additional complexities to plan for, including children from prior relationships and maintaining harmony in blended families. For senior marriages and couples with a larger age gap, they may need a tailored trust that plans for differing financial needs. At a minimum you may want to add your new spouse, change your agents and trustee, change your beneficiaries, and possibly protect your children from the negative consequences of a divorce should it come to that.
2 Trust maintenance and updates after having a child.
JUBILEE MENZIES Another shift that warrants a look at the trust is if you’ve had a child or become the legal guardian of a child. Part of updating your estate plan for a child is making sure you’ve named guardians who could step in if you were to pass away or become incapacitated and unable to care for your child. That’s when the guardian could step in. Have those conversations with the other parent as to who those guardians would be in the absence of both parents. Those can often be difficult conversations, difficult decisions, and having that talked through and decided upon during times of clarity and ease is much better than waiting to see who would step up in a crisis and present themselves as available to take care of your child. It’s better for you to sit down and plan that, talk that through, have those hard conversations when they are hard, and, and you know, make that decision yourself.
A trust update can also impact the parents of a child with special needs who know they’re going to need to do specific kinds of planning to benefit the child and not negatively impact them. For instance, if you don’t do proper planning and a child with special needs were to inherit assets outright, there can be unintended consequences such as disqualifying them from government benefits like healthcare and housing.
If you don’t set up a trust after your child is born, the law will distribute assets when the child turns 18, and for many parents, putting large sums of money in the hands of an 18 year old is not the decision they would want. Instead, they can plan so that the parents’ trust will have subtrusts that continue for the children until they’re of a more appropriate young adult age, and in the meantime, a trustee can be in charge to provide for the health, education, maintenance, and support of the child.
3 Update your trust after the death of a spouse.
JUBILEE MENZIES The death of a spouse falls under a shift in marital status and as such, it calls for an update to your trust for things like identifying a backup trustee if your spouse was your co-trustee, rethinking your beneficiaries and removing your spouse from the list, and revising your power of attorney and healthcare directives if your spouse was identified as your main agent.
4 Update your trust after a big financial event.
JUBILEE MENZIES A major wealth event is often reason to update, or at least revisit and review, your trust. It’s a good time to make sure your trust still aligns with goals and often those change with a financial change. For instance, if your trust provides a plan for a specific property and you’ve recently sod that property or bought a new one, you may need to update your trust. Or sometimes people who have had a major wealth event develop more charitable goals whereas previously they were only looking to make sure they pass their wealth on to the next generation. Like charitable gifts for beneficiaries outside the primary beneficiaries such as a college fund for nieces or nephews.
If, on the other hand, your wealth has taken a financial hit and you previously planned with very generous charitable gifts in mind, you may need to make more modest charitable plans.
5 Update your trust to change your beneficiaries or your managers.
JUBILEE MENZIES Beneficiary changes can signal something big – when people we love pass away or people who are in our inner circle change. At times like these, it’s good to double check and make sure that your trust is going to meet the goals you have. And sometimes, you don’t quite realize that your goals have changed until you sit down and look at what your 30-year old self had planned and you realize that your life has gone in a different direction. You didn’t have the children you had planned for and there are other people important to you and close to you who you’d like to see benefit from your successes.
The other thing that commonly comes up is when you want to change who’s going to act on your behalf, your agents for health care and power of attorney, successor trustee, guardians, and executor. Maybe you and your brother were close for most of your lives, but he moved across the country, remarried, or is facing a health crisis. Now’s the time to identify a closer, more suitable manager.
Q Is a Laughlin Legal trust update Q Is a Laughlin Legal trust update attorney a good choice for my revocable living trust update?attorney a good choice for my revocable living trust update?
We think we’re an excellent choice. If you’d like to find out why, please reach out and schedule a complimentary consultation with a Laughlin Legal trust update attorney to see if we’re a good fit. If you or someone you love needs to create an estate plan, amend a trust or will, learn more about how the services we offer can best represent you and your values. Call us now at 650.343.3486 to schedule your consultation or if you’d prefer, you can email us to set up your appointment. If we miss your call, we will respond promptly and call you back as soon as possible.
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