Creating an estate plan feels like something you check off a to-do list. Once the task is complete, you can move on and forget about it. However, that is not the mentality you should take when drafting your final wishes. An estate plan should be an ongoing process that reflects your current circumstances and should be periodically reviewed and amended as your life changes.
How often do you need to update your estate plan? Most estate planning lawyers will tell you that the answer depends on your unique situation. However, some factors can help you decide when it may be time to review and make changes to your plan.
Review Your Estate Plan After All Major Life Events
You may not always need to update your estate plan, but you should review it after every big life event. Examples of life changes that may require you to change or update your estate plan can include:
Marriage or Divorce
Birth or adoption of a child
Death of a spouse or child or designated agent
Significant health changes or diagnosis of a medical condition
Significant health changes for a spouse or child or designated agent
Financial changes
Reaching retirement age
Change of employment
Change of domicile
These life events can impact your finances and who you want to include as beneficiaries of your estate. Remember, an estate plan isn’t just about drafting a will. Your estate plan could include:
Health Care Proxy
Living will
Power of Attorney
Last Will and Testament
Trusts
If you get a divorce, do you still want your ex-spouse to make medical decisions for you if you are incapacitated? Have you recently had a new baby and want to ensure you properly divide certain assets among all your children? Maybe you received a promotion at work, and your financial situation and retirement plan have significantly changed. A life event can have a ripple effect, changing your status today and potentially creating issues for your estate down the road. Although you may not always need to make changes to your estate, it is always best to reevaluate your goals after a life-altering event.
The Calendar Review Method
Some advisors recommend that you review your estate plan every one to five years. By setting a date on the calendar to look at your plan, you are more likely to take the time to actually do it. If calendaring is not your thing, tie reviewing your plan to a holiday/observance that makes you think of organization or finances, like the week of New Year’s, Spring Cleaning, or Tax Day.
Regardless of what you choose, setting aside time to review your plan at designated intervals allows you to audit your finances more objectively. You may be less overwhelmed with emotion or stress when making decisions, and you’ll be able to discuss your situation with an attorney from a place of clarity and confidence.
Need to Update Your Estate Plan? Consult with Us Today
Updating your estate plan doesn’t have to be challenging or time-consuming. With the help of one of our skilled estate planning attorneys, you can feel confident that you’re making the best estate plan decision and that you and your family are protected.
