Some people create an estate plan, put it somewhere safe, and never look at it again. Unfortunately, having an out-of-date estate plan can be almost as bad as not having one at all.
Your life changes, and your estate plan needs to reflect those changes. Here are the key times in your life that you should consider updating your plan.
Change in marital status
Marriage and divorce are two significant life events that should trigger a review of your estate plan. You may need to update your will, designate new beneficiaries and possibly name a new power of attorney.
Addition to the family
The birth or adoption of a child is a time for celebration and also a time to update your estate plan. You will want to name guardians for your minor children if something happens to you and your spouse. You may also want to establish trusts to manage your child’s inheritance.
The death of the executor
If the executor of your estate passes away, it’s crucial to name someone else to ensure your estate is handled according to your wishes.
Change in financial situation
Receiving a large inheritance or buying or selling a business can impact your estate plan. You may need to change how your wealth is distributed or name a successor for your company.
Estate laws can vary between states. If you move to a different state, you must ensure your estate plan complies with state laws.
Every few years
Even if nothing changes, you should review your estate plan to ensure it complies with state and federal regulations.
You have already done the hard work of creating your estate plan. But it’s important to remember that it is not a one-time task. Your plan should reflect where you are on your life’s journey.