How regularly should I update my estate plan?

| May 15, 2020 | Estate Planning

Estate planning may seem like a one-and-done deal, but that’s not the case. Drafting an estate plan is only the beginning of the process; keeping your estate plan updated is what’s necessary.

Without an updated estate plan in place, if you fall ill or pass away unexpectedly, your assets may end up in places you did not intend for them to go. Updating an estate plan is critical to guarantee that your property passes along to the right person or organization upon your death.

As you go through your life, you will buy more assets, expand your family, or have a falling-out with an old friend. It’s essential that you review your estate plan after significant life events such as:

  • An addition to your family. The birth of a child or grandchild is a significant reason to revise your estate plan. You can ensure that you leave behind a trust fund for a granddaughter or plan a guardianship for your new child.
  • A loss to your family. Likewise, if a loved one recently passed away, you should look at your estate plan in case you planned to leave something behind to them. Leaving the name of a deceased family member on your estate plan can cause complications in the future when trying to pass along your assets to that person.
  • You recently married. It’s common for someone to leave a significant portion of their estate to their spouse. If you got married since you last updated your estate plan, now is the time to revise it and add your spouse as a beneficiary.
  • You recently divorced. In a similar vein, if you got divorced since you last updated your plan, you should make sure to remove your ex-spouse so that they don’t accidentally receive any assets in the future.
  • You bought a substantial asset. Large assets are essential to include in your estate plan. If you purchased a new home, an expensive car or boat, or other sizable assets, you must add it to your plan to ensure it’s passed on accordingly in the future.
  • You started a business. Adding a business to your estate plan guarantees its continuity if you pass unexpectedly. You can set up a succession plan for your business and outline what should happen to your company if you are no longer able to run it.

Estate planning is more than just creating a will; it’s a crucial step in arranging all your valuable possessions and preparing for the future. It helps you plan for unexpected illnesses or accidents and ensures that your assets will reach the person you wanted to have it.

Regularly updating your estate plan can give you the peace of mind you need for the future.