Less than half of US adults have an estate plan. If you are among this minority that has taken the essential step of protecting their assets and well-being, you deserve a pat on the back. The work doesn’t end when an estate plan has been drafted, though. Just as important is keeping your estate plan up-to-date. Generally, it is wise to review your plan every five years but certain life events mean you should do so sooner.
Five Times Life Demands an Estate Plan Update
1. When You Get Married
Whether you are marrying for the first time or remarrying, anytime you invite a new partner into your life you want to ensure they are reflected in your planning. A marriage necessitates a review of your Will, Medical and Financial Powers of Attorney, and any other estate planning documents on file.
If your new marriage comes on the heels of a divorce, you likewise want to make sure your estate plan is up-to-date with this change.
2. Upon the Arrival of a New Child or Grandchild
Just as you want to ensure a new spouse is reflected in your estate plan, you also want to make sure updates are made upon the arrival of a new child or grandchild. While it is easy to think that you could hardly forget to write such an important person into your Will, it has often happened, most notably in the case of Heath Ledger. Avoid this mistake by reviewing your estate plan at the earliest possible convenience anytime your family grows.
3. When Your Assets or Liabilities Change
Any significant change in the value of your estate is reason to undertake a review. Whether this change is for the better or worse, it is important to take a second look at how your property and assets are divided and determine whether this organization still makes sense.
4. Whenever Your Beneficiaries Require Updating
The need to update beneficiary designations can arise for several reasons. A loved one may grow estranged; a family member may die; a new person may join the family; a child may divorce. Any time your relationship with an individual named in your estate changes, you should revise your plan. Additionally, it is important to remember that beneficiary designations of IRAs, 401(k)s, and other retirement plans are determined by the designation form on file, not your Will or trust.
5. After an Election
When a new administration enters office, estate planning legislation often changes. Anytime this happens, it is important to speak to an experienced estate planning attorney about how your plan may be affected and how best to respond.
The above is hardly an exhaustive list which is why it is important to revisit your plan periodically even if you see no obvious reason to do so. Priorities have a way of changing without notice and memory is fallible.
To learn more about keeping your estate plan up to date do not hesitate to reach out to the Hailey-Petty Law Firm either by calling (512) 910-8977 in Austin, (210) 570-2458 in San Antonio, or by using the contact form on our website.