Updating Your Estate Plan
It’s a good idea to update your estate plan every few years or after the occurrence of significant life events such as marriage, divorce, the birth of a child, or adoption. Even if you haven’t experienced any of these events since you last updated your estate plan, there may have been changes in tax laws or changes in your financial situation that necessitate a reevaluation of your estate plan. Updating Your Estate Plan.
Your desires as far as how your property will be distributed are likely to change over the years, especially as certain events occur in your life. For example, if you get a divorce, you probably don’t want to make the same bequest to your former spouse as you did when you were married. In some states, provisions regarding an ex spouse in your will can be disregarded, and the remaining portions of your will followed. In other states a will that is created prior to a divorce will be deemed invalid after the divorce.
Other significant events that will require you to update your estate plan are marriage, re-marriage, the death of a beneficiary, and the death of an administrator or executor. Most states provide for a statutory share of the estate that will go to a surviving spouse. If this statutory requirement is not in keeping with your estate planning desires, you will need to have a valid pre-nuptial or post-nuptial agreement to avoid it.
This becomes particularly important for individuals in a second marriage who have grown children from a first marriage. In this situation, you may want to provide for the comfort of your current spouse during his or her lifetime, but you will want to make sure that your children ultimately inherit your assets. Without proper planning, your current spouse’s children could end up inheriting your assets, instead of your own children.
Another thing that tends to change over the years is your financial situation. If your current estate plan was made even a few years ago, your net worth may have changed enough that you will need to incorporate more estate tax planning into your estate plan, Also, tax laws are constantly changing, and some changes may necessitate updating your estate plan.
Finally, you should reevaluate your desires from time to time. You may find that you’ve changed your mind about a variety of issues addressed by your estate plan. Do you want a different person to be the administrator of your estate, rather than the one who is currently named in your will? Did you grant a health care power of attorney to one of your children and now that child has moved to a different state? Is there something about the way one of your beneficiaries is leading his or her life that would make you want to put their bequest into a trust rather than granting it outright? You may have become aware that one of your children has trouble managing money and you fear their creditors might end up with the inheritance.
If you already have an estate plan in place, you deserve congratulations for planning ahead and being prepared. But you also need to remember to update it from time to time as your situation or needs change.
Reference: Rebecca Berlin, AllLaw.com
Filed Under: Estate Planning
Kindly visit our Estate Planning website for more information on this topic. – If you have further questions and need help on this case, contact our lawyers at Pozzuolo Rodden Pozzuolo, P.C. Law Firm today!