Once you have created a will, power of attorney documents and other planning documents, believing that you have finished your task can be tempting. However, reviewing and revising your plan as your life changes is essential. When might you want to update your estate plan?
Your family dynamic has changed
Getting married, welcoming a new child into your family, or having a child reach adulthood are all joyous occasions. However, these changes to your close family relationships can be an important reminder to update your plan. You should adjust your plan to support your growing and changing family. Painful circumstances like divorce or losing a loved one should also be cause to review your plan.
Your financial situation has changed
If you have received a significant inheritance, changed careers, had a significant windfall or experienced financial hardships, your estate likely looks very different than it did when you created your estate plan. Crafting a new plan, reconsidering how you want your property to be divided and addressing other details such as tax implications can be important ways to protect those assets and provide for your family.
Changes to real estate holdings
Real estate is often a person’s most valuable property. If you have bought a house, sold land or engaged in another real estate transaction, you may want to utilize different estate planning tools to protect your investments.
You have moved to a new state
Creating a new plan to ensure that you have a valid will and other documents in place is an essential step for people that have relocated. Every state has its own requirements for a valid estate plan. As a result, your old plan may no longer fit the legal standards in your new home state.
More than three years since estate planning completed
Sometimes, the small steps you take in life can add up over time. Your income may change slowly. Your relationships may shift. Your goals may change. Because these changes are often subtle, reviewing your estate plan periodically is vital to ensure that it still fits your life and wishes.
Periodically reviewing your estate plan and seeking guidance about updates can help you ensure that your estate plan reflects your wishes at every stage of your life. While three years is not a set in stone time frame, it can be used as a frame of reference for review.