Your estate plan provides instructions about what you want to happen with your assets after you die. It also includes provisions for what happens if you become incapacitated. All terms are set based on your circumstances when the plan is created.
For most adults, circumstances will change in their life. Many of these require you to update the estate plan. It’s best to take the time to review the plan every three to five years, even if you didn’t have anything change during that time.
Changes in your assets
If you buy or sell assets, you need to update your plan. Having assets in the estate plan that you don’t own can be costly because the estate may have to purchase those assets for the beneficiaries or heirs. Failing to put everything in the estate plan can also lead to problems because your loved ones may fight over what’s not included.
Changes in your life
Major changes in your life also require you to make updates to the estate plan. Some of these have to do with your family composition. These include:
- You get married or divorced.
- You have a child or adopt one.
- Your child becomes an adult.
- You have a grandchild.
You also have to make changes if anyone who’s named in the estate plan passes away or becomes incapacitated. You need to consider how you can still care for loved ones if they’re disabled or reliant upon need-based programs.
Don’t focus only on heirs and beneficiaries who pass away. You also need to update the plan if the administrator or power of attorney passes away or can’t fulfill the duties.
You should review your estate plan when the laws or regulations regarding estates change. Even if you don’t think that it applies to your situation, it’s still a good idea to review it. The plan also needs to be updated if you move to another country or state.
Making sure your estate plan is up-to-date is the only way you can ensure your wishes are followed when you die. Work with someone who understands your wishes and can provide you with the best legal avenues to make those a reality.