Estate planning is not a one-and-done type of deal. It should continuously evolve along with your life circumstances.
No matter who you are, your life will inevitably change. In the absence of any major life events, I recommend reviewing your plan at a minimum of every three to five years to make sure its terms are up to date.
Yet there are several common life events that require you to immediately update your plan, such as these seven significant events.
You get married.
Marriage not only changes your relationship status, it changes your legal status. Regardless of whether it’s your first marriage or fifth, you must take the proper steps to ensure your plan properly reflects your current wishes and needs.
After getting hitched, some of your most pressing concerns include naming your new spouse as a beneficiary on your insurance policies and retirement accounts, granting him or her medical power of attorney and/or durable power of attorney (if that’s your wish).
You get divorced.
Since divorce can be so overwhelming, estate planning often gets overshadowed by the other dramatic new changes happening. But failing to update your plan for divorce can have devastating consequences.
Once divorce proceedings start, you’ll need to ensure your future ex is no longer eligible to receive any of your assets or make financial and medical decisions on your behalf – unless that’s your wish. Once the divorce is finalized and your property is divided, you’ll need to adjust your planning to match your new asset profile and living situation.
You give birth or adopt.
Welcoming a new addition to your family can be a joyous occasion, but it also demands entirely new levels of planning and responsibility. At the top of your to-do list should be legally naming both long- and short-term guardians for your child.
A loved one dies.
The death of a family member, partner or close friend can have major consequences for both your life and estate plan. If the person was included in your plan, you need to update it accordingly to fill any gaps his or her absence creates.
From naming new agents, beneficiaries, executors and guardians to naming new agents to care for you in your incapacity and identifying new beneficiaries to receive assets allocated to the deceased, make sure you address all voids the death creates as soon as possible.
You get seriously ill or injured.
As with death, illness and injury are an unavoidable part of being human. If you’ve been diagnosed with a serious illness or are involved in a life-changing accident, you may want to review the people you’ve chosen to handle your healthcare decisions as well as how those decisions should be made. The person you want as your healthcare proxy can change with time, so be sure your plan reflects your current wishes.
You relocate to a new state.
Since estate planning laws can vary widely from state to state, if you move to a different state, you’ll need to review and/or revise your plan to comply with your new home’s legal requirements. Some of these laws can be complex and some allow for acceptance of your old documents, make sure you know.
Your assets or liabilities change significantly.
Whenever your estate’s value dramatically increases or decreases, you should revisit your plan to ensure it still offers the maximum protection and benefits for yourself and your loved ones. Whether you inherit a fortune, take out a new loan, close your business, or change your investment portfolio, your plan should be adjusted accordingly.
Ensure your estate plan is regularly reviewed and updated at all times. A regular review will put you at ease, knowing your family is protected and provided for no matter what happens.
This article is a service of Law Office of Lasca A. Arnold, PLLC. We don’t just draft documents, we ensure you make good decisions for you and your loved ones.
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