Creating your estate plan is a big undertaking, and you should be proud of yourself for your efforts. However, estate planning doesn’t stop there. The essential components of your estate – will, trust, bequeaths, etc. – were all based on life as you knew on the date you finalized the plan and walked away with a binder and/or digital file. As a result, that living document could be seriously out-of-date.
If your estate plan is signed and dated more than five years ago, there’s a good chance things have changed – in big and noteworthy ways. As we like to say, “As time passes, change is the one constant…”
For your estate plan to reflect your current family structure, assets, life situation, and intentions, you must revisit it regularly – making it a ritual of sorts. Putting off this important estate plan maintenance leaves your estate vulnerable, and can make it far more complicated for the ones left behind when the plan is put into place.
7 Reasons to Revisit Your Estate Plan on an Annual Basis
Most estate lawyers recommend revisiting your estate plan on an annual basis. Some years, it’s a quick review – not much has changed, and a cursory read and refresh are all you require. Other years, you’ll be surprised to note all that has shifted or changed – things that need to be added, removed, or altered –to fit your current life picture. In almost all cases, you’ll find your estate needs a “tune-up” around every five years or so.
The following are 7 of the most common reasons to revisit your estate plan to keep it as up-to-date as possible.
The family portrait has changed
It’s amazing how much can happen in a single month, let alone a year or more, within a family unit. From the birth of children and grandchildren to our loved ones’ deaths, or even drastic shifts in your own or a family member’s financial picture – these changes may alter how you feel about your current estate.
For example, a child’s divorce may cause you to remove their former spouse from the plan while keeping their joint children in place. Down the road, that same child’s re-marriage may bring other beloved step-grandchildren into the fold, and you may choose to create space for them in the plan.
Whatever changes occur, it’s worth considering how that may affect the way you want to allocate your estate’s assets – and that needs to be finalized by your attorney via an updated plan.
Relationships have shifted
While it’s true estates are typically distributed amongst family members, many beneficiaries of an estate are not related to the decedent at all. For example, dear friends of the family, a longtime neighbor or step-relatives with whom you’ve become close. However, relationships can change, or one of your beneficiaries may have come into a large sum of money on his/her own, the lifelong neighbor may pass away…
Whatever the case, you may find that shifts or changes in your relationship alter how you feel about the original estate plan’s allocations.
The kids/grandkids grew up
Maybe you’d set aside a certain sum of money for your children or grandchildren to attend college – and then outlived that span of time. In some cases, you may opt to keep this financial allocation intact so they can use it however they want, or you may decide to lower or raise the amount they receive when you die.
Your favorite charity is no longer active
Have you included a favorite charity or non-profit in your estate plan? Would you like to? Charities can come and go, or your favorite charities can change over time, depending on your interests and life experience. Sometimes, your financial health expands over time, and you have more available to leave to charities or other beneficiaries. On the flip side, you may need to scale back those allotments due to a slimming down of your financial portfolio.
In either case, you want to make sure that the charity/ies named in your will or trust are still active and that the contact information is the same. Changes can be made as to the amount you want to be allotted to them. Charities no longer in existence should be removed, and new ones added if that’s your desire – and the rest of your estate may need to be adjusted to reflect those changes.
you moved is another reason to revisit your estate plan
Estate laws vary from state to state. If you’ve moved, we recommend taking your estate plan to a reputable estate attorney, practicing in your new state, to see if it complies its estate laws.
One of your beneficiaries has pre-deceased you
We’ve alluded to this in some of the above examples, but it’s worth an independent mention. If any of your beneficiaries die before you do, the money, property, or other assets you left them are no longer accounted for – and this puts your executor/trustee in an uncomfortable position. Now it’s up for her/him to make decisions about how things are allocated, not an easy task if the rest of the beneficiaries are fighting disagree with how it’s handled.
Someone has or develops special needs that should be accounted for
Has a child with special needs been born or adopted since your original estate plan was drafted? Has someone in your family developed a medical condition or special need that you would like your estate plan to address? That type of change requires amendments or re-drafting of your original estate plan or you cannot guarantee your wishes will be upheld – even if you’ve had verbal agreements from your executor/trustee or loved ones.
Revisit Your Estate Plan With Us
Give yourself and your family the peace of mind you all deserve by revisiting your estate plan on a regular basis. This is the only way to ensure your wishes will be carried out exactly as you intended.