When to Update Your Estate Plans
Estate planning is a critical aspect of financial and personal well-being. However, it’s not a set-it-and-forget-it endeavor. The circumstances of your life, the laws, and your financial situation can change over time, necessitating periodic reviews and updates of your estate plans. In this article, we will explore the key factors that determine when and why you should update your estate plans.
Regular Review
After you have created estate plans, it is a good idea to review them at least every three to five years to ensure they still fit your situation. This review will remind you of what you included in your estate plans and determine if they need to be updated.
Every 6-8 years, it is also a good idea to review your estate plan with an attorney to ensure that it still conforms with state laws. This is particularly important if trusts are involved.
In addition to that, the following items may be cause for updating or amending your estate plans.
Key Estate Plan Actor Changes
If any of the key estate plan participants change, you should revisit your estate plans to determine if you need to update them. In particular, changes to your executor, guardian, or power of attorney’s should be addressed immediately.
For a review of who does what in an estate plan, check out my article: Navigating the Complex Web of Estate Settlement: Understanding the Key Actors and What They Do – Gilbert Wealth
Family and Health Changes
- Births or Deaths in the family
- Marriages or Divorces
- Special Needs Considerations for Disability
- Legal, Creditor, or Financial trouble of a beneficiary
- Government Assistance Considerations
- Planning for minors
- Updating trust rules if specific ages were outlined in the trust
Law Changes
Federal and State laws change and may impact your estate plans. There may be strategies you were planning to utilize that are no longer available or new strategies that you should consider.
Updated Goals
You may have developed your estate plans year ago and now your goals for your estate have changed:
- How much you leave and to whom
- What organizations you support
- The types of care you home to receive or not receive.
Bequests, Estate and Charitable
- Changes to the people or their situations who you want to make gifts to such as family members.
- Changes to the types of gifts you intend to be transferred s
- Changes to the following:
Financial Changes
- Financial Accounts
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- New accounts or accounts that are no longer funded
- Changes in account types may have different estate considerations. For example, Traditional IRAs and Roth IRAs have different estate considerations.
- Life insurance
- Real Estate
- Have you changed residency?
- Have you bought or sold a new home or rental property?
- Any new or changed out of state property
- Businesses
- Any new businesses
- Businesses that were sold
- Changes in business successions or structures