An estate plan is a vital tool to ensure your wishes are carried out after you’re gone. But creating an estate plan isn’t a one-time task. It’s important to review and update it regularly to reflect changes in your life.
After major life events
Significant changes in your personal life are a clear signal to update your estate plan. Events like marriage, divorce, the birth of a child, or the death of a beneficiary can affect how you want your assets distributed. Updating your plan ensures it aligns with your current family situation.
Changes in financial status
If you’ve experienced a substantial change in your finances, it’s time to revisit your estate plan. This could include receiving an inheritance, winning a lottery, or a significant increase or decrease in your assets. Adjusting your plan helps manage your wealth according to your new financial standing.
Changes in tax laws
Tax laws can change over time and may affect your estate. Keeping your plan current with the latest tax regulations can help minimize taxes on your estate. This ensures that more of your assets go to your loved ones instead of taxes.
Regular reviews every few years
Even without major life changes, it’s wise to review your estate plan every three to five years. This allows you to make minor adjustments and ensures everything is up to date. Regular reviews help catch any issues that might have been overlooked.
Beneficiary updates
If relationships with beneficiaries change, you should update your estate plan. This could be due to estrangement, reconciliation, or changes in needs. Keeping beneficiary information current ensures your assets go where you intend.
Health changes
Serious health issues are another reason to update your estate plan. If you’re diagnosed with an illness, you might want to adjust your healthcare directives or appoint a power of attorney. This ensures your medical and financial wishes are respected.
Updating your estate plan is essential to keep it aligned with your life. Regular reviews and updates ensure that your assets are handled according to your wishes. Stay proactive with your estate planning to provide peace of mind for you and your loved ones.
