If you have already have an estate plan in place, that’s great. It means you have taken the time out of your busy life to plan for something we would all rather not think about: our eventual death. However, if it has been a few years since you put your estate plan in place, it might be time to revisit it.
That’s because your estate plan isn’t made to stand the test of time. Changes within your life and changes within the law can mean that your estate plan no longer works as you intended, and your carefully thought-out strategy can be completely derailed.
Here are a few examples of how that can happen.
First, changes in your life can require changes to your estate plan. Perhaps you welcomed a new child, ended a marriage, or lost a family member; each of these situations could warrant changes to your beneficiary choices, guardianship elections or attorney-in-fact designations.
Next, changes in state or federal tax law can poke holes in your original estate plan. For example, when the federal estate-tax exemption changes, as it has dramatically over the past 10 years, it can greatly affect your estate plan and potentially disinherit a spouse if you aren’t careful enough to revise it.
The good news is that revisiting your estate plan will likely take a lot less time and energy this time around. You are already familiar with the lingo and how the process works, which means that you can sail through the updates with the help of an experienced estate planning lawyer.
Experts commissioned by The Wall Street Journal recommend revisiting your estate plan with your lawyer once a year.
Source: The Wall Street Journal, “Common Estate-Planning Mistakes,” Jan. 13, 2014