Creating an estate plan takes time and considerable thought. However, it’s vital to protect your family and ensure that your wishes are followed.
Once all the documents are signed, most people store them somewhere safe until they’re needed. That can be a mistake, because your estate plan should evolve as your life changes.
Outdated estate plans can cause problems
You have experienced major life events and you will probably have many more. Some of those changes are significant enough to warrant a review of your estate plan.
Marriage or divorce can affect who you want to inherit your property and whom you trust to make decisions for you. If you’ve remarried, you may need to consider how you will provide for your spouse and children from a previous relationship.
The birth or adoption of a child or grandchild is another reason to review your plan. You may want to update your beneficiary designations or name a legal guardian for a minor child.
Changes are also happening to the people around you, which can affect your choices for important roles. The person you originally named as executor, trustee or power of attorney may no longer be the right choice because of age, health or distance.
Other documents may need updates as well
Your estate plan is more than just your will or trust. Many assets, including life insurance policies and retirement accounts, are distributed according to beneficiary designations. Reviewing those designations periodically and after major life events can prevent those assets from going to someone you no longer intend to benefit.
Even if you experience no significant life events, you should still review your estate plan every three to five years. You don’t necessarily need to make changes. The purpose of the review is to determine whether your existing documents still reflect your wishes.
An estate plan is most effective when it reflects your life as it is today — not the life you had when you originally signed the documents. If it’s been several years since you last reviewed your estate plan, consider speaking with a legal professional about whether your plan needs to be updated.
