Once you draft an estate plan, it is important to remember that you do have the ability to modify the plan. Many people suggest reviewing your plan every 3 to 5 years. This gives you a chance to check for any potential updates that are necessary.
In other words, estate planning is not something that you just set and forget. It is best to make a plan early, such as in your 30s or 40s. But you may still live for decades after creating that plan, so periodic updates are helpful to address changes in your life, your family situation or estate planning laws themselves.
When are updates necessary?
There are a wide variety of reasons why an update may be necessary, depending on the unique details of your plan. Some examples include:
- Changes in marital status, such as getting married or divorced
- Changes in your immediate or extended family, such as the birth of a child or a grandchild
- Shifts in family dynamics, such as your children getting married or divorced themselves, which may mean you need to consider the role their spouses play in your estate plan
- A significant medical diagnosis, which may mean that it is time to look into your options to use a medical power of attorney, a living will or another type of advance directive
- Changes to tax laws or state laws, which may give you new options or mean that your original estate plan does not work the way you intended
- Changes in your own assets, such as if you are a business owner who sells their business or if you decide to downsize and sell the family home that you were originally going to leave to your children
These are just a handful of examples, but they help show what type of life events you should look for. Take the time to carefully look into your options to modify an estate plan.