Life Events that Require an Estate Plan Update

Estate planning is not a one-and-done process; it should evolve with your life circumstances and financial situation. It’s essential to review and update your estate plan regularly and after significant life events to ensure that it accurately reflects your wishes and provides the intended protection for your assets and loved ones. As an experienced Folsom estate planning attorney, I have listed a few of the more common life events that may require an estate plan update:

1. Marriage: When you get married, you may need to make changes to your will, living trust, beneficiaries, and other estate planning documents to provide for your spouse. You may also want to create a prenuptial or postnuptial agreement.
2. Divorce: Divorce can have a significant impact on your estate plan. You may need to update your will, living trust, power of attorney, and beneficiary designations to remove your former spouse and ensure your assets are distributed according to your new wishes.
3. Birth or Adoption of Children: The arrival of a new child or adopted child often prompts updates to your estate plan. You may need to appoint guardians for minor children, create or update living trusts, and adjust beneficiary designations.
4. Death of a Spouse or Beneficiary: If a spouse or other beneficiary named in your estate plan passes away, you may need to update your plan to name new beneficiaries or make other adjustments.
5. Changing Financial Situation: Significant changes in your financial circumstances, such as receiving a substantial inheritance, starting a business, or experiencing financial setbacks, may necessitate adjustments to your estate plan. A living trust may help to reduce estate taxes and otherwise provide flexibility for your changed circumstances.
6. Relocation: Moving to a new state or country can affect your estate plan, as estate laws vary by jurisdiction. You may need to update your plan to comply with local laws and regulations.
7. Health Changes: A diagnosis of a serious illness or a decline in your health may prompt changes to your healthcare directives, living will, and powers of attorney for healthcare and finances.
8. New or Acquired Assets: If you acquire significant assets, such as real estate, valuable investments, or business interests, you should review and update your estate plan to address these assets adequately.
9. Retirement: As you approach or enter retirement, your financial goals and priorities may change. You may want to revisit your estate plan to ensure it aligns with your retirement objectives.
10. Changes in Relationships: Changes in your relationships with family members or other potential beneficiaries may influence your estate planning decisions. You may want to reconsider how your assets are distributed.
11. Business Ownership Changes: If you own a business, changes in ownership structure or partnerships may require updates to your estate plan, particularly if you want to address succession planning.
12. New Laws or Tax Changes: Changes in federal or state laws related to estate taxes, trusts, or other estate planning matters may necessitate updates to your plan to take advantage of new opportunities or ensure compliance.
13. Beneficiary Life Changes: If a beneficiary experiences a significant life event, such as marriage, divorce, or a financial windfall, you may need to adjust your estate plan to accommodate these changes.
14. Passage of Time: Even if there are no major life events, it’s a good practice to periodically review your estate plan every few years to ensure it remains current and reflects your wishes.

Conclusion

There are many events that may necessitate an update to your estate plan. To ensure your estate plan is always up to date and effective, consult with an experienced estate planning attorney in Folsom who can help you make necessary adjustments based on your unique circumstances and goals. If you have any questions regarding estate planning and recent changes in your life, please call Thapar Law at 916-579-0605 or send us a message.