There are important times in life when it is a good idea to update an estate plan to ensure it is up-to-date and to change anything that needs changing from when it was set up or when you last updated. Because of its importance, estate planners should know when to update their estate plan.
Your estate plan probably includes several components such as a will or trust or both and may also include a power of attorney or advance healthcare directive. It is important that all of these are kept current. Designations on the estate planner’s retirement accounts and insurance policies, such as a life insurance policy, should also be kept up-to-date because they will be controlling and should not be outdated for that reason.
One big change that can occasion the updating of an estate plan is a relocation to another state. A big move means that the estate planner needs to ensure their estate plan is compliant with the laws in their new state. Another important time to update an estate plan is if the estate planner’s relationships change. If the estate planner goes through a major relationship change, such as a marriage, birth, death or divorce, they should update their estate plan accordingly to reflect these changes in their life.
Lastly, a review of an estate plan should also be conducted if the estate planner’s assets and liabilities change. Because one of the primary purposes of estate planning is to distribute the estate planner’s assets, the estate plan should be as current as possible concerning them. Estate planning tools offer guidance throughout the processes of establishing and modifying an estate plan as needed and are essential resources for estate planners to be familiar with.