National Estate Planning Awareness Month: 7 Life Events That Will Require You to Update Your Estate Plan
4 Minute ReadEach October across the United States, individuals and families are reminded of the importance of creating and/or maintaining an estate plan. Estate planning is incredibly important to provide a secure and determined future for your family and assets. A plan is necessary to manage one’s accumulated wealth over a lifetime, providing care and support for family members in the coming years.Since your family’s needs and circumstances are constantly changing, so too must your estate plan. Your plan must be updated when certain life changes occur. If any of the following seven events occur, it’s best to contact your attorney:
- Marriage
- When you get married not only does your relationship status change, but it also changes your legal status. You must take the proper steps to ensure your plan properly reflects your current wishes and needs. In the event of death, your money and assets may not automatically go to your spouse, especially if you have children from a prior marriage, a prenuptial agreement, or if your assets are jointly owned with someone else (like a sibling, parent, or family member).
- Birth or Adoption of Children or Grandchildren
- Welcoming a new addition to your family can be a joyous occasion, but it also means entirely new levels of planning and responsibility. Checking and adding the new child as a beneficiary is always a good idea. It is also a good idea to list a guardian in an estate plan so someone can take care of your children or grandchildren if something happens to the testator.
- Financial changes and acquiring new assets
- Whether it is a sudden salary increase, inheritance, purchasing a home, life insurance coverage, or the purchase of a large asset should prompt an adjustment in an existing estate plan. Some of the most common trigger changes that trigger the need to change estate plans include the following:
- Purchasing a home
- Selling a home
- Receiving an inheritance or gift
- Starting a business
- Selling a business
- Retirement
- Significant changes in property or asset values
- Whether it is a sudden salary increase, inheritance, purchasing a home, life insurance coverage, or the purchase of a large asset should prompt an adjustment in an existing estate plan. Some of the most common trigger changes that trigger the need to change estate plans include the following:
- Moving to a new state
- If you’ve recently relocated to a new state, it’s important for them to review their estate plans. Their new state laws could significantly affect your current plan. Estate and inheritance laws vary from state to state as do property laws. These laws in your new state could greatly impact how your assets are passed to your beneficiaries.
- Change of Heart
- What you want for your estate plan today might not be what you want in the future. If you’ve had a change of heart regarding how you want your estate handled, it’s best to work with an estate planning lawyer who can update your estate plan based on this information.
- Medication condition
- A serious medical diagnosis or sudden accident should prompt an urgent review of your estate planning needs. You should also create or update a living will which lays out your wishes for medical treatment and end-of-life care.
- Death
- If a close family member who played an important role in your estate passes away, whether it is a beneficiary, executor, appointed guardian, or even a health care proxy, make sure to update your current estate planning.
Estate planning should be a priority regardless of your age or income status. There are numerous reasons to amend an estate plan, a will, or a living trust. You may have changed your mind about something such as beneficiaries, division of assets, or who you want to have your power of attorney since you last looked at your estate plan. By staying proactive and seeking professional guidance when needed, you can ensure that your legacy is protected and your loved ones are cared for according to your wishes.
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