Reviewing your will is something that many people know they should do but often put off. However, various life circumstances and legal changes can significantly impact your estate planning needs. Ensuring that your estate plan, including your will and other estate planning documents, reflects your current situation is essential for peace of mind and securing your beneficiaries' future.
Your will is not a static legal document. As your life changes, so also might your wishes regarding how your assets are distributed after your death. It's common for relationships, financial circumstances and family dynamics to change over time. Each significant shift in your life may warrant a review and possible update of your will.
One of the most common reasons to update your will occurs when your family dynamics change. Have you recently married, divorced, or welcomed a child or grandchild? These life events may change how you want your estate distributed. It's important to review your will to ensure that new family members are included or that former spouses are removed, reflecting your current wishes.
If you've appointed guardians for your children and these guardians can no longer serve, you'll need to revise your will. The same applies if your executor or trustee situations have changed.
Laws governing wills and estates vary by state. If you have moved to a new state since you last updated your will, it may be time to review it. The legal requirements in your new location might differ from those in your previous residence, affecting estate administration. Meeting with an attorney specializing in estate planning in your new state is advisable to ensure your documents comply with local laws.
State and federal tax laws are constantly changing and can impact your estate planning significantly. An increase or decrease in estate or inheritance tax, for instance, could affect the value of your estate that your beneficiaries will receive. Reviewing your will with an estate planning attorney can help you understand the latest tax laws and revise your estate plan accordingly, ensuring that your heirs are protected from possible tax burdens.
A substantial increase or decrease in the value of your estate is another reason you should review your will. If you've acquired new assets, started a new business, or maybe some assets have depreciated significantly, your current will may no longer reflect your situation accurately. You may wish to redistribute your assets, set up a trust instead, or address the specific needs of a growing estate.
As time passes, you may need to update beneficiary information. Beneficiaries may have passed away, or your relationship with them may have changed. It’s equally important to review other estate planning documents, like life insurance policies and retirement accounts, to ensure that all beneficiary designations are up-to-date and consistent with your will.
Your financial power of attorney is a vital part of your estate plan. If your chosen agent is no longer willing or able to serve or your relationship has changed, you may want to revise this document. It is essential to have a trustworthy individual to make financial decisions on your behalf if you cannot do so.
One of the main reasons to review your will is for your own peace of mind. Knowing that your affairs are in order and your loved ones will be taken care of according to your wishes is priceless. Regularly reviewing your estate plan every few years or after major life changes ensures that everything is up-to-date and reflects your desires.