How Inflation Can Affect Your Wisconsin Estate Plan

October 5, 2026

Over time, inflation can reduce the real value of fixed-dollar gifts in a will or trust. Our Wisconsin estate planning attorneys can help you protect you from inflation in your estate planning.

If your will or trust leaves a specific dollar amount to a person or charity, for example “$10,000 to my niece,” or “$25,000 to my church,” or “$5,000 to each of my grandchildren”, that number has been quietly losing value every year since the document was signed. It doesn’t matter how carefully the figure was chosen at the time. A specific bequest dollar amount set forth in your Will or Trust does not grow unless it specifically states that it will be increased based upon inflation. But, as we know, inflation will result in the value of the specific bequest being reduced.

For our Trust and Will clients, this is not an abstract issue. It is a real, practical drafting problem that shows up in Wills, Trusts, and beneficiary designations. It is a problem that is easy to overlook because nothing about the document itself changes. The erosion happens silently, in the background, until the day the plan is actually administered.

Inflation Since 2020 Reduces the Value of a Specific Bequest

Consumer prices are up roughly 3.4% over the past twelve months nationally. According to the U.S. Bureau of Labor Statistics (BLS), the Chicago-Naperville-Elgin, IL-IN-WI area regional price index which is often used in the Midwest, and specifically southeastern Wisconsin, has seen prices rise about 2.4% over a comparable period.

Zoom out further, and the picture is more dramatic: cumulative inflation since 2020 has run roughly 29% to 30%, depending on the starting month. A $25,000 bequest written into a plan in 2020 has the purchasing power today of roughly $19,300 in 2026 dollars. The beneficiary still receives a check for $25,000, but it buys noticeably less than the Will or Trust creator may have intended when the document was signed.

How Inflation May Distort What You Actually Intended

Estate plans generally distribute property one of two ways:

1. As a specific bequest (e.g. as a fixed dollar amount or a particular piece of property); or
2. As a residuary or percentage share (a fraction of whatever is left after specific bequests, debts, and expenses are paid). Percentage and residuary shares naturally track the value of the estate.

For example, if the estate grows, the residual or percentage share grows and increases  with it, and inflation is often a non-issue. However, fixed-dollar amount specific bequests do not have the self-correcting feature of a residual or percentage bequest. Specific bequests are frozen in place the moment the ink dries on the Will or Trust, unless there is an inflation clause written into the Will or Trust.

That mismatch creates two related problems.

1. First, the beneficiary of a fixed-dollar bequest quietly receives less real value the longer the plan goes unrevised, as a $10,000 gift to a grandchild meant to help with a first car or a semester of books may, ten or fifteen years later, only cover a fraction of that same goal.
2. Second, because a will or trust is really a snapshot of relative priorities among the people named in it, letting one category of gift lose value while the estate’s other assets keep pace with inflation (percentages) subtly changes how the estate is actually divided, often in ways the client never intended.

Fixed-dollar thresholds embedded elsewhere in a plan also raise issues. For example an age-based trust distribution (“$50,000 outright at age 25”), a cap on a testamentary trust meant to fund a particular purpose, or an allowance for burial or final expenses can all become outdated in the same quiet way if expressed as a set dollar amount. It is worth having your attorney look at the plan as a whole, not just the specific bequests, when inflation is a concern. Inflation is essentially another reason to review your estate plan if there has been a significant passage of time.

Why Your Will or Trust and Estate Plan Deserves a Periodic Review, Not a One-Time Fix

Congress has already built inflation-indexing into the federal transfer tax system so now the federal estate and gift tax exemption is adjusted annually based on the chained Consumer Price Index. For 2026, the exemption is $15 million per person, and it will continue to be adjusted for inflation in future years. That is an acknowledgment, even inside the tax code, that a fixed dollar figure loses meaning over time if it isn’t periodically recalculated. Most personal estate planning documents don’t have the same treatment unless a client requests it or agrees with the attorney to include an inflation clause.

When to Review Your Estate Plan

As estate planning attorneys, we generally recommend that clients revisit their estate plan at least every five years, or sooner after a major life event (marriage, divorce, a birth, a death in the family, a move, a significant change in asset values) or a significant economic shift like the inflationary period we’ve experienced over the last several years. For plans with specific dollar bequests, that review should specifically address whether the currently stated amounts in the Will or Trust still reflect what the person or organization should receive in “today’s dollars.”

Ways to Update Your Will or Trust if Needed

The most straightforward update is a plain amendment (a codicil to a will, or an amendment to a trust) that revises the specific dollar amounts to reflect current purchasing power and current desires. This is easy to understand and explain to family members, but it requires the client to periodically review and update. In our experience, that follow-up does not always happen.

Where the underlying intent is really “I want this person to receive a meaningful share of my estate,” rather than a specific number, converting the bequest to a percentage of the estate residue lets it track the estate’s value automatically. This works well for many of our clients but isn’t always the right fit.  Often clients want to leave a fixed sum (say, to pay for a grandchild’s education or to satisfy a specific charitable pledge), and a percentage share doesn’t capture that intent as cleanly.

For clients who want to preserve a fixed-dollar amount while still protecting its real value, we can draft the bequest with an inflation-adjustment clause.  The stated dollar amount is treated as a base figure as of the date the document (or the most recent amendment) is signed, and the stated dollar bequest is automatically recalculated at the time of distribution based on the change in a specified CPI index between signing of the Will or Trust and death.

Choosing a National CPI-U vs. the Chicago-Area CPI Index

When drafting an inflation protection clause, one of the choices we make with the client is which index to use. The national CPI-U (All Urban Consumers, U.S. city average), published monthly by the BLS, is the most familiar benchmark and works well as a general-purpose national measure.

Yet for Wisconsin clients, we also discuss and often use the regional Chicago-Naperville-Elgin, IL-IN-WI CPI-U as an alternative or as the named index. Southeastern Wisconsin’s economy and cost of living are closely tied to the greater Chicago metro area, so it is a reasonable regional proxy, it’s an index many Midwest attorneys and businesses already use in leases, support agreements, and other escalation clauses, and unlike some regional indices it is published by the BLS with a track record long enough to draft around confidently. Note, however, that Kenosha County is the only Wisconsin county included in the Chicago-area index. For clients in Milwaukee, Racine, Waukesha, and other Wisconsin counties, the BLS Midwest Region CPI-U is another widely used option. Like the national CPI-U, the Chicago-area index is published monthly.

Well-drafted CPI clauses also include a few safeguards: a fallback provision naming a successor or comparable index if the BLS ever discontinues the chosen one, and for clients who want more predictability, an optional floor (the bequest never adjusts below the original stated amount) or a cap (it never exceeds a specified ceiling), so the personal representative or trustee isn’t left administering an open-ended figure.

CPI-indexing isn’t the right tool for every plan. It adds a small amount of complexity to administration, since the trustee, personal representative, or attorney involved who settles the estate needs to look up the applicable index value and run the calculation. It also shifts value among beneficiaries: any increase to an inflation-adjusted gift comes out of the residue of the estate, which reduces what the residuary beneficiaries receive, and if the estate is not large enough to cover all of the gifts, Wisconsin’s abatement rules determine which gifts are reduced first.  So, it isn’t necessary to have an inflation adjustment clause for clients whose intent is better served by a straightforward percentage bequest or by simply committing to periodic reviews or simply expressing a set dollar amount and not adjusting it for inflation. But for a client with a genuine fixed-dollar intent, a specific gift amount that matters in terms of real purchasing power at death, an inflation adjustment clause is a useful way to make sure that intent, and not just the number, survives.

Let’s Take a Look at Your Plan

If your will or trust includes specific dollar bequests and it has been a few years since you last reviewed it, it is worth a conversation with our team. We can walk through each bequest with you, talk about whether the current dollar figures still reflect what you want to happen, and discuss whether a straight update, a shift to percentage shares, a CPI-indexing clause, or some combination is the right fit for your family and your estate. We can also review other aspects of your plan to see if law changes, family changes, asset changes, or other changes make revisions to your trust, will, or powers of attorney appropriate.

Wokwicz Law Offices LLC works with Wisconsin clients on estate planning, probate, and trust administration matters, for clients with both large and more modest estates. If it’s been a while since your plan was last reviewed, contact our office to schedule a plan review.

This post is provided for general informational purposes only and does not constitute legal advice. Every estate plan is different, and you should consult with an attorney about your specific circumstances before making changes to your will, trust, or other estate planning documents.