In some ways, estate planning is never finished because as the estate planner’s life changes, their estate plan should also change to keep up with the changes in their life. It is important for estate planners to have an estate plan that represents their wishes, including as those wishes evolve over time.
When to update an estate plan
In addition to regularly reviewing an estate plan to ensure it is up-to-date once the estate planner has made an estate plan, there are certain times and circumstances in an estate planner’s life when they should review their estate plan including:
- When the estate planner’s relationships change – if the estate planner’s relationships change, it is a good time to update their estate plan. This includes if they are married, divorced or experience a birth or death.
- When the estate planner’s assets or liabilities change – so that the estate planner’s estate plan can be effective at distributing their assets, it is important that any changes are incorporated into an updated estate plan.
- The estate planner moves to another state – if the estate planner moves to another state, they should ensure their estate plan complies with the laws in their new state including the rules for valid wills in their new state.
It is also important that estate planners keep beneficiary designations on retirement accounts and life insurance policies current. Additionally, if designations in the estate plan, including executors, trustees and guardians, become outdated, they should also be updated.
Creating an estate plan and changing an estate plan do not have to be complicated steps to take and estate planning tools and resources can help. Because of the importance of having an estate plan that is up-to-date, estate planners should know when they should take a second look and update their estate plan.