When is the time right to update your will, trust and other legal documents?

According to Mildred V. Palmer, partner in the law firm of Waltz, Palmer and Dawson LLC of Rolling Meadows, you should re-evaluate your estate planning legal documents at least every five to seven years because most people's lives undergo significant changes at least that often.

But there are other things that should trigger a quicker review like the death of a spouse, child or someone else named in the documents; if you go through a divorce, separation or remarriage; if you inherit a lot of money; if you move out of Illinois; or if you experience serious financial boons or setbacks. Changes in certain laws could also necessitate a review, Palmer said.

Estate planning documents come into play when you either become disabled (even temporarily) or when you die.

"I see the preparation of documents like powers of attorney for health care and property, a living will and the signing of a HIPPA authorization form (which allows multiple named individuals to see your medical records and talk to your doctors) as basic necessities for anyone over the age of 18," she stated.

"If someone is involved in a serious accident or has a sudden health incident, their loved ones could be facing guardianship court if these papers have not been prepared and signed," Palmer cautioned. "They won't be able to make any decisions about your health care or even access your bank accounts to pay your bills without signed powers of attorney for health care and property."

And if you don't detail how you want to be treated through a living will, you could be left alive in a hospital bed for years.

Palmer urges everyone to actually consult an attorney for these important papers, not to just try to do them online.

For the living will, for instance, you should use the statutory form for Illinois which talks about providing the person with "sustenance" should they become incapacitated. But not everyone wants to be kept alive with a feeding tube, Palmer said, so you want to talk to attorney who can amend the form to fit your individual needs and desires.

"I see these basic forms as a person's exit strategy. You are deciding who you want to step in and make medical decisions for you and access your assets to pay for your needs if the worst happens," Palmer explained. "Once you are in that hospital bed, it is too late to sign these vital papers. Every adult needs to have them if they don't want to become a ward of the state with a judge controlling their lives."

"Judges try to do what is in the best interests of each person, but lots of times there are onerous, unintended results of their decisions because they do not know you or because of the requirements under the law," she added.

A trust can also be useful in avoiding guardianship court, assuming that the person's assets are held in trust name. Wills, on the other hand, only become relevant once you die and then the overriding concerns are avoiding probate or court administration and reducing the amount of tax paid.

"If you only have a will, I like to say that that is your ticket to probate court. But probate is better than having no will or trust because then your loved ones end up in court under the laws of administration where there is no personal choice. Everything is done by state statute," Palmer explained.

She strongly recommends engaging in estate planning as soon as possible because the older one gets, the more easily they can be swayed or influenced by beneficiaries, so Palmer said individuals should make these arrangements when they have the ability to be sure what is right and appropriate for their individual situation and family.

"An attorney will not execute a will or a trust if they are not sure their client is of sound mind so if you wait too long and are on the edge of having the necessary mental capacity, it could become a problem. Everyone has good days and bad days and as we age, those bad days become more apparent. You are really rolling the dice if you choose to wait. If you haven't completed these documents, you are just multiplying your heirs' expenses and heart ache," she stated.

In addition, if you have only a will when your time comes, your estate will almost certainly go to probate court which is entirely avoidable, expensive and allows extended family members a forum to air family grievances publicly.

"A trust is much more private and allows you to better manage and protect your assets. In addition, fewer people are willing to go to the trouble of challenging a trust just so they can complain about their family members' treatment of them in the distant past," Palmer added.

There are many types of trust, depending upon your circumstances. But they fall into two general categories: revocable trusts and irrevocable trusts.

Revocable Living Trusts (RLTs) are the most popular because they allow living people of good mental state to proceed with their lives without any discernible change, using their assets as they did before they established the trust. In addition, a revocable trust can be rewritten in part or in totality at any time.

"It is simply an extension of you," Palmer stated.

If you own a business or are part of a partnership, different trust forms should be considered and discussed with your attorney.

Irrevocable trusts may be updated through a process called "decanting" but cannot be changed in substance, Palmer said. They leave the trust holder with few options.

"Having a well-written trust is a gift to your family. It allows them to quickly take care of creditors, transfer assets and move on, instead of dragging on the process for months or years," she added.

When people are working on these legal papers, Palmer urges them to consider what is ultimately most important to them and what legacy (besides money) they would like to leave to each individual. This is when you should make sure that your favorite grandchild gets your mother's rosary or what-have-you. Leave each one something with personal meaning to you.

She also urges parents to talk to their grown children about their wishes. If they have heard you say that you do not want to be kept alive by extraordinary measures if you are seriously ill, it makes it much easier for them to make that difficult decision to discontinue life support.