Life is full of big changes—some exciting, some unexpected—but they all have the potential to impact your estate plan. Major life events, from marriage to financial shifts, can alter your wishes, legal responsibilities, and asset distribution. Failing to review and update your estate documents accordingly might lead to state laws or outdated instructions determining what happens to your assets. Here are some key life events when it's essential to review your estate plan:
A Significant Change in Assets
Whether you receive an inheritance or start a business, shifts in your financial situation require you to reassess your estate plan. Adjustments ensure that your plan aligns with your current goals and circumstances, like protecting new assets or managing debts effectively.
Death of a Beneficiary or Executor
If someone named in your estate plan passes away, it’s crucial to update your designations. This ensures your wishes are still carried out as intended and helps avoid potential legal complications or disputes.
Getting Married or Divorced
Marriage alters your legal and financial circumstances, which can affect asset distribution. Conversely, divorce demands immediate action to prevent unintended beneficiaries from inheriting your assets. Reviewing and updating your estate plan during these times keeps it aligned with your life status.
Becoming a Parent
Bringing a child into your family means planning for their financial protection and clearly designating guardianship in emergencies. This life change underscores the need to secure your children's well-being regardless of unforeseen events.
Moving to a New State
Estate planning laws vary by state, which means moving can necessitate updates to your will, trust, or other documents. Ensuring compliance with local laws is essential to maintaining your estate plan's effectiveness and legality.
Seeking professional estate planning guidance can help you navigate these changes smoothly. It's wise to consult with an estate planning attorney if you have questions or want to discuss your situation further. Regular reviews, every three to five years or after major life changes, will keep your estate plan current and reflective of your wishes.