HOW AND WHEN SHOULD I UPDATE MY ESTATE PLAN?
July 10, 2020
If you have an estate plan, you’re doing better than about 50% of Americans, who don’t have a plan in place at all. Good job!
Now, have you considered the need to update or amend your plan? You can’t just cross things out and initial your changes. For one thing, you would need two witnesses to make the changes official. For another, certain changes in your life can make it so parts of your plan are no longer appropriate. It’s not a good idea just to cross some things out and hope for the best.
When might you need to update your estate plan?
The most immediate reason you would need to update your estate plan is that you have moved to another state. Estate plans are state-specific and based on each state’s differing laws. What you had in Connecticut simply won’t work for California.
Similarly, you should update your plan if you have moved from one home to another. Estate plans generally specify that the home at such-and-such address goes to certain designated beneficiaries. You will need to make sure the updated address is included, or this part of the will could be considered invalid.
Another common reason is a change in your relationships. Have you gotten a divorce or gotten married? Do you have new children since the plan was originally drafted? Has someone died? What about your charities? Are you still interested in leaving money to the same charities as you were when you initially wrote your estate plan?
Another change in your relationships to consider is when one of your children has become your primary caregiver. If this has happened, your child may have devoted substantial time and money to your care. Does this mean they should inherit more than your other children? Perhaps. You should decide and implement any necessary changes.
Changes in your assets is a third common reason to update your estate plan. This could mean that the value of your assets or your overall financial situation is different than it was when you implemented your estate plan. Or, it could simply mean that you have given some items away that would otherwise have gone to your beneficiaries.
Have you purged your home to ensure everything in it sparks joy? If you have gotten rid of things that were specified in your estate plan, you should update your plan to reflect that.
Good estate planning is an ongoing process
It would be great if your will or estate plan could be done once and forever. Unfortunately, circumstances change — frequently. You don’t want to leave your assets to your ex-spouse. You don’t want to leave out one of your children. Charitable gifts can seem more or less pressing as time goes by.
As with any plan involving your money, you should always have your estate plan in good shape in case the worst should happen. Updating your estate plan generally does require sitting down with an estate planning attorney, but it is time and money well spent.