How Often Should I Update My Estate Plan?

Life is full of changes, and your estate plan should reflect them. Whether it’s a new marriage, the birth of a child, changes in financial status, or shifts in state laws, your estate plan isn’t something to set and forget. Regular updates ensure your assets are protected, your wishes are honored, and your loved ones are taken care of according to your intentions. But how often should you revisit it? Here are a few key milestones and timelines that signal it’s time to update your estate plan, helping you stay proactive and prepared for whatever the future holds.

Changes in Assets and Liabilities

You could win the lottery. The app you created could make you millions. In short, something good could happen to you pecuniarily. You could have been planning to have the house sold and the proceeds split between your children. Suddenly, you have far more than you ever dreamed of having, and there are other decisions to make, other family members to take care of, etc. You also could wind up with large amounts of debt and not have as much left to give. Or, you might take a bad gamble in the stock market and lose your proverbial shirt. In any event, you must keep track of what you have and what you don't to know how to proceed.

Life Events

Let's say that one of your children gets married to someone who is already incredibly wealthy. That child will then very likely no longer need to be included in your will because the new spouse will provide for the person. Conversely, if the person marries into your family, you might then provide for that person in your plan. Either way, making the change early is smart.

You could have another child naturally, through adoption, or other means. If this happens, then you're probably going to want to provide for that child. You'll need to arrange things so that that child receives what you deem worthy.

Alterations in State or Federal Laws

Different states and countries have different laws that affect you leaving your assets to others after your death or incapacitation. The same holds true for powers of attorney, irrevocable trusts, and the like. It's also a good idea to get all the information you need before you move so that everything is in place from the exact effective date of your change of residence. Additionally, federal, state, or local laws could change even if you're not moving, so it's wise to seek counsel and to change your plans accordingly.

Family Dynamics

After a divorce, either yours or a family member's, you might want to change your will or trust agreement so that that person receives less or even nothing at all. You also might fall out with someone even if the person were to remain part of the family. Betrayal is a strong motivator to disinherit someone, so if that happens, you must be prepared.

Aging Beneficiaries and Executors

It's best to be prepared before you become too old, too feeble, or too weak of mind to make your own decisions. Part of your estate planning should include your own care in your old age. It should also name appropriate powers of attorney over your medical and financial decisions. One important choice is whether one person will wear both hats, or if there will be two or more people who must make decisions for you. Additionally, you should name your executor and beneficiaries because powers of attorney are canceled by death.

Health and Incapacity

Aside from growing older, you could experience a health disaster. You could be in a car wreck and wind up with diminished capacity because of brain damage. You could wind up in a coma for years and need around-the-clock care. Planning ahead will make things much easier for those who will have to take care of you in this instance.

Periodic Reviews

In general, you should update your estate plan about once every three to five years. Leaving it longer than that can lead to problems in several situations, especially if you die or become incapacitated in some way before making your wanted changes.

Conclusion

Crafting an estate plan requires forethought, preparation, and wisdom. Revisiting your estate plan on a regular basis is not only reasonable, but it's also good to make sure your wishes are carried out exactly as you want them. We can help you with that, so when you want to set everything up for when you're gone or incapacitated, giving your family and friends peace of mind, call to set up an initial consultation.