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How to tell if you need to update your estate plan?

On Behalf of | Dec 27, 2023 | Estate Planning

Once you make an estate plan, you must remember that it can go out of date. While it won’t expire, changes in your circumstances could mean it no longer works. If that is the case and you do not update it before you die, it could create delays and confusion for those you leave behind while a probate court steps in to try and untangle it all.

It’s easy to give your estate plan a quick glance every year or so to make sure there are no glaring errors or omissions. Yet the following triggers can highlight the need for more urgent change:

Changes to the assets you own

Fortunes are built and lost, and you can only pass on what you have when you die. Make sure your plan covers all the assets you currently own and none you no longer own.

Changes to the people in your life

Maybe you were single and childless when you made your original plan. If you then had a child and married, your plan should reflect that. You should update it again if you have another child or divorce to ensure that any assets you leave are distributed according to your current wishes, not those from decades ago.

Death is another reason to update a plan, not yours, but that of anyone named as a beneficiary or in a position of responsibility, such as an executor or power of attorney. You’ll need to decide who you want to take over from them, or in the case of a deceased beneficiary, who will receive the share of wealth earmarked for them.

Changes to tax laws

Inheritance tax is one of the major points where campaigning politicians can differ. Some think inheritances should be taxed heavily, and others think they should not be taxed at all. That can lead to changes in tax rates and tax allowances when a new government enters that you may need to alter your plan to profit from (or at least avoid losing out from).

Consider learning more about how to adapt your estate plan for changes in laws or your circumstances.