Having an estate plan is one thing. Updating it is another. Many people forget this step and pass away, leaving their family with an outdated estate plan that was written years or even decades earlier.
So when should you update your plan? One option is to review it periodically. For example, some people schedule an annual review to examine their documents, consider changes in their life or estate planning laws, and confirm that their plan still works. Creating this type of routine helps ensure the estate plan is only minimally outdated if you pass away unexpectedly.
Identifying key events
It is also important to consider major changes in your life, family or estate. Updates may be necessary even before a scheduled review. Common life events that may require revisiting your estate plan include:
- The birth of a child or grandchild
- The death of a beneficiary
- Getting married or divorced
- The marriage or divorce of an adult child
- Major changes to estate planning laws at the state or federal level
- Acquiring significant tangible or financial assets
- Selling major assets, such as a home or business
- Receiving an inheritance
- Being diagnosed with a serious illness, such as Alzheimer’s disease or cancer
For example, if you get divorced, you may need to update your estate plan to remove your former spouse. If you are diagnosed with Alzheimer’s disease, it may be time to update your medical power of attorney or living will to clarify how medical decisions should be made in the future.
Every situation is unique, but the key is remembering that estate plans need to be updated and taking the proper legal steps to do so when necessary.
