A properly drafted estate plan, which includes your will, and often a trust, can protect both you and your loved ones’ future and ensure your wishes concerning the distribution of your assets at death are realized. Therefore, a critical part of your estate plan involves periodically revisiting these documents to avoid unintentional oversights.
These are among the life events that may signal it is necessary to change your will or trust.
You Marry or Separate
Updating your will or trust when you marry will ensure that your new spouse can participate in vital decisions or that stepchildren can expect the same treatment as natural children, if this is what you want. However, if this is not what you want, you need to understand your options and the statutory benefits available to surviving spouses under the law as they will impact the distribution of your estate. Also, you want to make sure you update your plan to remove a spouse if you separate with the intent to divorce in order to prevent that person from receiving any part of your estate should you die before your divorce is final.
You Have a Child
The most significant reason for updating your will or trust when you have children is to name guardians to raise them if something happens to you. Otherwise, the court will choose guardians who may not have your child-rearing views. in addition, you will want to consider who will manage the assets you leave to your children. This person is called the trustee, and it can, but does not need to be, the same person as the guardian.
Your Finances Change
Gaining or losing significant money or assets signifies the need to update your will or trust. These circumstances may allow you to include more beneficiaries or increase the size of bequests, but can also warrant removing some when the assets you plan to leave no longer exist.
Your Health Deteriorates
An illness may require you to use the financial assets you plan to leave to others. However, you may also decide that you want to distribute your assets before you die. Either way, it is crucial you take a close look at your estate plan if you receive a diagnosis of a terminal illness or dementia as it may be your last time to update your will or trust.
Your Spouse Dies
When your spouse or another significant beneficiary dies, updating your will or trust prevents intestate succession laws from replacing that person with someone you do not want to receive your assets.
Life is unpredictable, and your circumstances can change. Creating an estate plan is necessary for everyone, no matter what the size of your estate, and remembering to review it every few years will ensure it serves your intended purposes.