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When To Update Your Estate Plan

Dec 21, 2023 | Estate Planning

Estate planning is the process of determining how your assets will be preserved, managed, and distributed upon your death or incapacitation. Despite the common belief that estate plans are only for the wealthy and elderly, creating an estate plan is a crucial part of protecting your hard-earned assets and loved ones from financial risks and jeopardy. 

One vital aspect of estate planning is ensuring that your plan is up to date, so it isn’t a one-and-done sort of process. You should update your estate plan every couple of years OR if you have a significant life event take place. 

In this blog we’ll address these life events so that you know when your estate plan needs to be updated in order for it to be as current and effective as possible. Let’s dive in!

You Need To Update Your Plan…

When You Get Married

Like estate planning, getting married requires a great deal of thought and consideration. It’s essential that you align this transition in your life with the legal affairs you already have in place. In addition to updating your name (if you change your last name), you may also want to consider adding your spouse to your estate plan as a beneficiary, or even possibly creating a joint estate plan together. Either way, your estate plan should reflect this significant change in your life. 

If you have a serious partner you’re not married to, but do not want your assets to go to your immediate family should something happen to you, you can also add them as a beneficiary of your estate plan.

When You Get Divorced

Like marriage, divorce is another transition you may experience in life. If and when this occurs, it’s easy to become overwhelmed by the sudden legal checklist divorce can present. However, updating your name, and more importantly, removing your former spouse from your estate plan is a necessary step. If you fail to do so and become incapacitated or pass away, your assets may end up in their hands. 

You should also be aware that if you don’t remove your spouse as a beneficiary, some states will disinherit your ex upon your death, which leaves your assets to the next beneficiary in line which may not be what you want. That’s why it’s important to provide total clarity on your desires by removing an ex-spouse who you don’t wish to leave property and assets to.

When You Have Children

If you and your significant other birth or adopt a child, it’s important to add said child to your estate plan. Many young parents don’t consider that even in good health, bad things can still happen to them, so it’s important that your preferences for your children are clearly outlined in your will and trust. Otherwise, your children may end up with an unintended guardian, or without financial assistance. If you don’t pick a guardian, the probate court will do it for you, which may not be in the best interest of your children. 

You may also want to consider naming a guardian for any minor children after divorce if you feel your ex-partner and co-parent wouldn’t be a proper fit if you were to pass away. 

When You Have Grandchildren

If you are living out your golden years and your children begin having their own, you may want to consider updating your estate plan to include these new members of your family to ensure they’re financially taken care of. 

A trust is an excellent estate planning tool that will allow you to set the terms of how your assets are managed and distributed so that you can be sure your grandchildren receive the assets at an appropriate time, perhaps when they’re old enough to utilize your assets responsibly. 

When Your Spouse Passes Away

Losing a spouse can be a devastating thing to go through. It can be especially challenging to focus on any of the legal implications that come along with a death, including updating your estate plan. However, if you and your spouse created a joint will and trust, you will likely need to create a new one and remove your spouse as a beneficiary. You may also need to consider naming a new power of attorney so that someone can appropriately act on your behalf if you become incapacitated. 

When You Move 

If you move to a new state, but already have an estate plan in place, you’ll need to take a look at your new state’s estate planning laws to determine if your current estate plan is compliant with said laws, or if you’ll need to update the documents you already have. An estate planning attorney can assist you with this process. 

When Your Financial Situation Changes

Because your estate plan is intended to protect both traditional and digital assets, like your home, vehicles, bank accounts, investments, and more, when there is a change in your financial situation, the future of these assets may become hazy. Whether you make a large purchase like a new home, have a significant increase or decrease in your income, or experience other financial shifts, revisiting your estate plan so that it accurately depicts your financial circumstances is crucial to ensuring effective protection of your assets.

When Your Relationship To Someone Changes

Naming beneficiaries is a personal matter that is entirely in your hands. This means that you can designate any beneficiary you see fit, not just family, but including friends, charities, legal entities, and more. However, any of these relationships has the potential to waiver, and someone or something that was once near and dear to you may no longer be an active part of your life. If that is the case, updating your plan to reflect that is necessary. 

How Fouts Law Group Can Help You

At Fouts Law Group, we understand how overwhelming the process of estate planning can be. You probably don’t want to plan for a future you won’t be a part of, but it’s something you won’t regret doing as it will ensure the well-being of your loved ones when the difficult day comes that you’re no longer here. Our estate planning attorneys can help you draft an estate plan that thoroughly outlines your wishes so that the people you hold dearest will be left with clarity of your desires for your hard-earned assets. We can evaluate your situation and unique needs, explain which estate planning tools might meet those needs best, and guide you through each step of the process. Call Fouts Law Group today to schedule a free consultation!

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