Do you need to update your estate plan?
You finally finished your estate plan. It was hard work and you put a lot of time and effort into it, but you can finally rest easy knowing that you have a plan for the future. However, could you be making one fatal error?
Not periodically reviewing and updating your estate plan could jeopardize all the work you put into carefully crafting your estate plan. Though you may not want to have to consistently review your estate plan, not checking in and updating it could undo everything.
Why do you need to review your plan?
A document as important as your estate plan needs to be reviewed periodically for a few different reasons.
It is important to take inventory of your assets and wealth every few years so you can make sure your estate plan is an accurate reflection of your property. If your estate plan is not up-to-date it will not be effective and do what you intend. Having a well-crafted estate plan that accurately reflects your life is the only way you can be sure it will properly protect and provide for your loved ones, the way you want.
When should you review or update it?
As a general rule, you should review and potentially make updates to your estate plan every three years. However, there are a few life events that should also prompt you to make changes or updates to your estate plan, including:
- Marriage or divorce
- Changes to tax law
- Moving to another state
- Birth of a child or death in the family
- Receiving an inheritance
- Starting a business or acquiring other assets
There are many reasons to update your estate plan and the ones mentioned above are just a handful. If you put all the work into creating your estate plan, you should also make sure it remains effective throughout time. Though it may not be the first thing you want to do, reviewing and updating your estate plan is just as important as initially creating it.