Estate planning isn’t finished when you put the papers in your safe deposit box and lock them away. In order for your estate plan to continue to be secure and effective you need to regularly review and update it to reflect current situations.
In general, you should think about checking over your plan every three to five years to make sure everything is in order and accurate. Additionally, there are several reasons you might need to update or change your plan sooner than this three to five year timeframe.
One of the most common reasons for changing estate plans comes from changes in people. Different people come in and out of our lives through death, birth, marriage and divorce. Be sure your estate plan reflects the current people in your life in terms of beneficiaries, estate executors, powers of attorney and health care directives.
Moving is another common reason for an estate plan update. If you decide to move or retire in a new location your estate plan may need to change. Different states have different rules and regulations for estate plan. Check to make sure your estate plan follows all the laws of your new location.
Property and accounts can also change frequently. If you received a large inheritance, made a new real estate transaction or sold your business your estate plan should reflect these. These types of changes can cause a significant adjustment in the value of your estate plan whether it has increased and decreased. Reviewing your plan to make sure your plan still reflects how you want your property distributed and divided is important.
An estate plan can only be truly effective if it’s updated and accurate. Reviewing your plan in light of any major life changes, as well as within the advised timeframes is important. You do not want all the work you put into your plan initially to go to waste because it’s outdated.