A true sign of financial independence is to worry about your estate plan and what to do with your assets after you pass away.

Some people, myself included, spend their entire adult life worrying about having enough money and then it is time to make a plan to give it away! This year is especially important to make sure your gifting, tax and estate plan are current. Why? Because the amount you can pass on to your heirs tax-free is likely changing.

There are dozens of possible scenarios of what could change but two things are certain:

The current tax-free estate exemption of $11.7 million per person was originally tagged to decline to just $3.5 million to pay for the Affordable Care Act many years ago. Now we are under another proposal from the Biden administration to reduce the amount you can pass on tax-free, and the $3.5 million remains a focal point.

There are other potential caveats that may change the crux of all estate planning as we know it. One example is if the step-up-in-basis on appreciated assets will be changed.

Currently, millions of Americans plan on passing their appreciated stocks, businesses and homes to their heirs with no tax on appreciation. The value of their assets will get “stepped up” to the date of death valuation and all appreciation is tax-free to heirs. If this basis step-up goes away, holding appreciated assets in your estate plan may be the opposite of what you should do.

Certain trust arrangements are also under fire. This means your current estate plan may need to be revised to capture the best advantages under any new laws. Since we don't know what will be become law and when, we can plan with what we know so far … there will be changes and they will likely be more restrictive.

One solution may be to start giving money away.

I am often asked “How much money can I gift to my child?” There are several answers to that question, but that usually indicates there a wish to pass on money or help children out. The simple annual gift exclusion is $15,000 per person per year. It can be cash, appreciated investments or shares in a business or building. Some estate plans suggest you should gift consistently every year and even multiply that by two and include your spouse as another donor.

The bigger picture suggests you can gift up to $11.7 million this year and use up your estate exemption while it remains elevated. This calls for a more strategic plan and education for the next generation of how to handle these funds. Discussing the different types of trusts that can be used to assist in this wealth transfer is also very important.

There will be many changes to restrict the ability to pass on massive amounts of wealth tax-free going forward. We have a heavy federal deficit and many pending bills around infrastructure, health care and education that need to be funded. The problem will not go away without an influx of capital from somewhere.

It appears that many changes will largely affect the very wealthy. But there are millions of people who don't consider themselves wealthy who could actually get caught in some of these changes. Perhaps their wealth is tied up in a business or real estate, or even long-term trusts designed for elder care.

Regardless of your situation, the message is the same: Be prepared, changes are a-coming.

Patricia Kummer has been a Certified Financial Planner professional and a fiduciary for over 35 years and is managing director for Mariner Wealth Advisors in Highlands Ranch.