When to Consider Revising Your Estate Plan (And What to Update) - Wylkan Estate Planning & Certified Elder Law

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When to Consider Revising Your Estate Plan

June 19, 2024

Is It Time to Update Your Estate Plan? Here's What to Look For:

Estate planning is one of those things that's easy to delay or put on the back burner. Once you've got your essential documents like wills and trusts in place, you think "Whew, glad that's done!" and move on with your life.

But here's an important reality - estate plans are not meant to just gather dust on a shelf. They need periodic reviews and updates as your personal and financial situations evolve over the years. An out-of-date plan can create as many problems as having no plan at all.

At our law firm, we generally recommend reviewing your estate plan every 3-5 years at minimum. But there are also certain life events and milestones that should automatically trigger a plan update. Let's go over some of the key scenarios where revisions may be necessary:

Family Transitions and Relationships

One of the most common reasons for updating an estate plan? Changes to your family. This could include:

Marriage / Remarriage - Getting married or remarried creates many new estate planning needs around assets, inheritance for current/new spouses and children, etc. Your existing plan may need an overhaul.

Births / Adoptions - Whether it's your children, grandchildren, or even great-grandchildren, you'll likely want to add any new family members as beneficiaries to your will and trusts.

Divorce - Ending a marriage requires removing your former spouse's rights as a beneficiary, executor, or representative in your estate documents. You may need to redo portions of your plan.

Deaths in the Family - If any beneficiaries, like a spouse or child, pass away you'll need to restructure how assets transfer and potentially name new beneficiaries or representatives.

In any of these scenarios, updating your plan to ensure your current relationships and wishes are properly accounted for is critical. No one wants to see unintended results happening with their estate due to out-of-date documents.

Evolving Asset Situations

In addition to family changes, any major shifts in your asset holdings and net worth could necessitate revisions:

Acquired / Sold Major Assets - Significant assets like vacation properties, businesses, rental investments, or valuable collectibles should be covered in your estate documents. Updating beneficiaries for them is crucial.

Inheritances Received - If you received substantial assets from relatives or others, don't assume your current plan will be sufficient. An update may be needed.

Changes in Asset Values - Sometimes fluctuations in the total values of your portfolio, real estate, business interests, or possessions may require adjustments. A plan optimized when you had less wealth may now be inefficient. Given how vital good estate planning is for protecting what you've worked so hard to build, it's common sense to keep your documents aligned with your current asset picture. Professional advice is wise here.

New Tax Laws or Move to New State - Estate plans are created based on the federal and state tax laws in place during that period. But tax legislation constantly evolves - what was optimal in your original plan may no longer be ideal. Additionally, if you have moved to a new state since your last estate plan update, it's highly advisable to review it. Each state has its own specific laws around estate taxes, trust jurisdictions, probate rules and more. Revisions may be needed for compliance.

A qualified estate planning attorney stays on top of these legal and regulatory changes. They can make any necessary modifications to keep your affairs structured tax-efficiently based on the latest rules and your current place of residency.

Life Milestones and Transitions

There are several other common life events and milestones that should prompt an estate plan review:

Retirement - If you have retired since you created your plan, you may want to adjust your gifting strategies, review beneficiary designations for retirement accounts, and ensure your current financial situation is accurately reflected.

Family Member With Special Needs - If anyone in your family has developed special needs, your existing plan may need to be revised. You may want to create a supplemental needs trust to preserve their eligibility for government assistance.

Changes in Personal Beliefs/Priorities - Sometimes general changes in personal values, philosophies on wealth, and thoughts around legacy happen over time. You may want to update your estate documents to reflect your latest mindset.

Declining Health or Mental Capacity - It's wise to review and potentially update estate documents if you or your spouse have entered into a period of declining health or shown signs of dementia/mental incapacity setting in.

Overall, the key principle is this - your estate plan should be a living, breathing set of documents that evolves alongside your life. By taking a proactive approach to routine check-ups, you ensure your legacy plans remain in sync.

Work With an Attorney You Can Trust

If it's been several years since you initially set up your estate plan, chances are high that some portions of it need to be updated. But trying to make these revisions on your own would be extremely risky.

Preserving your family's wealth, avoiding taxes, and preventing conflicts is far too important to leave to chance. This is why it's critical to have an experienced estate planning attorney overseeing your affairs as a trusted partner and advisor.

Wylkan Law can thoroughly review your existing documents at regular intervals and recommend any modifications, additions, or deletions to your plan to ensure it accomplishes exactly what you intend for your loved ones in a fully compliant manner.

If it's been more than 3-5 years since your last estate plan checkup, now is the perfect time to get on the books for a review. You've worked too hard to let an outdated set of documents undermine your final wishes.

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