Caterpillar Employees: 10 Estate Planning Mistakes That Can Derail Your Legacy

'For Caterpillar employees, reviewing your estate plan every few years is essential to keep pace with evolving family needs, tax law changes, and shifting financial priorities.' — Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.

'Caterpillar employees who revisit their estate plans regularly are better positioned to adapt to tax law changes and life transitions that could otherwise disrupt long-term goals.' — Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

1. How changing life circumstances and tax laws may impact the effectiveness of your current estate plan.

2. Key estate planning components—such as trustees, health care directives, and trust structures—that may need to be updated.

3. Practical steps for Caterpillar employees to keep their estate plans aligned with long-term financial and family goals.

Many individuals draft an estate plan—including health care directives, powers of attorney, trusts, and wills—and then set it aside for years. However, life circumstances, tax laws, and legal frameworks often shift over time. For Caterpillar employees managing long-term financial objectives, revisiting an estate plan every three to five years—or after major changes—helps keep the plan aligned with current needs.

Ten Signs Your Estate Plan May Be Outdated

1. Executors and Trustees: Are They Still Suited for the Role?

Executors and trustees carry major legal responsibilities, such as handling assets, filing tax returns, distributing funds, and acting on behalf of beneficiaries. These appointments may have been made under circumstances that no longer apply.

• - An executor may now be unable to serve due to health, relocation, or passing.

• - Professionals named in the plan may have retired or exited the industry.

• - Corporate fiduciaries may have undergone mergers or changes in structure.

• - Adult children listed as successors may now have other obligations or limitations.

Caterpillar employees may benefit from re-evaluating each fiduciary’s availability, financial awareness, and overall relationship with the family.

2. Trusts for Children: Have They Aged Well?

Trusts are often structured for minor children, outlining distribution ages and guardianship roles. But over time:

• - Guardianship provisions may be unnecessary if children are now financially independent.

• - Distributions set for age 25, 30, or 35 may have occurred or require adjustment.

• - Direct distributions might expose funds to potential claims in divorce or lawsuits.

• - Children’s maturity, spending patterns, or marital status may differ from earlier expectations.

• - Beneficiary designations on insurance or retirement plans may now conflict with trust goals.

- It’s worth assessing whether trust terms and retirement designations continue to reflect intended outcomes.

3. Health Care Proxies and HIPAA Authorizations

- If HIPAA authorizations are outdated, health care agents may be blocked from accessing vital medical information.

• - Without authorization, hospitals may limit updates or exclude family from treatment discussions.

• - Delays can affect treatment decisions and family coordination.

Caterpillar employees should verify that HIPAA documents are up to date—and that adult children, particularly those living independently, have health care directives of their own.

4. Growing Wealth and the Estate Tax Landscape

As of 2025, the federal estate and gift tax exemption is $13.99 million per individual and $27.98 million for couples. The annual gift tax exclusion is $19,000 per recipient.

However:

• - These elevated exemptions are temporary and expected to sunset in 2026.

• - Trust formulas created under prior laws may no longer be suitable.

Caterpillar executives nearing the exemption limit may want to speak with advisors about reviewing their gift strategies and trust funding formulas.

5. State Residency and Legal Nuances

Estate laws differ significantly by state:

• - Some states assess estate or inheritance taxes at lower thresholds than federal law.

• - Community property vs. common law distinctions can change how assets are divided.

If a Caterpillar employee has changed residency since creating their plan, a legal review may be warranted to enhance compliance with current state laws, particularly in states with unique estate tax structures like Massachusetts, Oregon, Washington, or Minnesota.

6. Portability and Credit Shelter Trusts

A surviving spouse may use any unused federal exemption from the deceased spouse through portability, but:

• - A federal estate tax return is required within nine months of death (15 months with extension).

• - Before portability, credit shelter trusts (CSTs) were common to preserve exemptions.

- Although no longer needed for federal purposes in some cases, CSTs may still be helpful for managing state or generation-skipping transfer (GST) taxes. Disclaimers and updates to trust structures may provide additional flexibility.

7. Charitable Giving: Aligning Purpose with Planning

Charitable giving is often a priority—but sometimes not reflected in estate documents. Potential planning tools include:

• - Specific gifts to charities listed in a will or trust.

• - Use of charitable lead or remainder trusts.

• - Donor-advised funds or private family foundations.

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Caterpillar retirees who value philanthropy should evaluate how well their estate plans incorporate these goals, and whether doing so could lead to tax advantages.

8. Estate Taxes vs. Income Tax Implications

Earlier estate plans emphasized reducing estate taxes, but income tax considerations are now equally important.

• - The federal estate tax rate is 40%.

• - Federal income tax rates can reach 37%, capital gains up to 20%, plus a 3.8% surtax.

• - Trusts reach the highest tax brackets with just $15,650 in income.

- It may be beneficial to shift income-producing assets out of trusts or re-evaluate distributions to individuals in lower tax brackets.

9. Life Insurance: Still a Strong Fit?

Life insurance policies created years ago may no longer align with your estate or cost objectives.

Consider:

• - Does the policy still perform competitively under current conditions?

• - Are premium costs sustainable?

• - Is it worth transferring ownership to an irrevocable life insurance trust (ILIT)?

It’s recommended that insurance policies be reviewed periodically to determine their ongoing relevance and financial impact.

10. Communication and Digital Organization

Many estate plans lack practical execution details. Family may not know where documents are stored. Fiduciaries might not have contact details or asset lists. Digital accounts and passwords may be inaccessible.

A comprehensive letter of instruction should include:

• - Contacts for attorneys, advisors, and fiduciaries.

• - An inventory of assets and their locations.

• - Login details for important digital accounts.

Clear planning and information access can simplify responsibilities and reduce confusion during transitions.

Bottom Line: Estate Planning Is a Process, Not a Product

As your circumstances and regulations evolve, estate documents should evolve as well. Caterpillar employees may consider:

- Revisiting documents every 3–5 years or after major changes.

- Involving attorneys, tax professionals, and financial advisors in reviews.

• - Reassessing roles, ownership structures, and beneficiary choices.

• - Including charitable goals and multi-generational intentions.

An estate plan should reflect your values and help facilitate your legacy.

Checklist: Key Areas to Review

A plan drafted years ago may no longer reflect your current priorities. Keeping it updated allows for better alignment with family dynamics, tax laws, and economic trends.

Recent data indicates many individuals in their 60s fall into the 'senior sandwich generation,' simultaneously supporting aging parents and adult children. This multi-generational responsibility may require adjustments in estate planning such as modifying liquidity goals, rethinking timelines for inheritance, or creating structures that serve multiple generations.

Final Thought

An estate plan left unchanged is like using an outdated map—it may miss important updates such as new fiduciary considerations, revised tax laws, or shifts in your family’s structure. For Caterpillar employees focused on long-term planning, periodic updates can help your legacy reflect today’s realities.

With consistent reviews and collaboration with qualified professionals, your estate documents can remain an effective and adaptable guide for your family and financial future.

Sources:

1. Doc & Law.  The Connection Between Estate Planning and Retirement Planning.  Doc & Law LLP, May 2025, pp. 1–3.

2. JustVanilla:  Why You Need to Periodically Update Your Estate Plan (and the Consequences If You Don’t).  JustVanilla, Mar. 2025, pp. 2–4.

3. Lanza, John R., and John E. Lanza.  Why Revisiting Your Estate Plan Upon Retirement Is Crucial.  Lanza & Lanza LLP, 25 July 2024, pp. 1–5.

4. Allegro, Alex. “Estate Planning Steps to Protect Your Loved Ones and Legacy.”  Kiplinger , 9 June 2025, pp. 2–4.

5. Kiplinger Staff. “Think a Repeal of the Estate Tax Wouldn’t Affect You? Wrong.”  Kiplinger , May 2025, pp. 1–3.