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When should you update your estate plan?

Updated: Jun 5, 2023

Creating an estate plan is a very valuable step in planning for your future. However, your estate plan does need to be reviewed.

The rule of thumb is to review your estate plan:

  • Every three years, or

  • Whenever there’s a major life event.

But what constitutes a major life event?

1) Changes in your family. Has there been a birth? A death? A marriage? A divorce? All of these instances warrant the review and revision of an estate plan. New family members should be named specifically to avoid potential conflicts and lawsuits. Past or problematic family members should be removed from an estate plan.

2) Your children have grown up. Often estate plans designate a guardian for minor children. However, if your children are 18 or older, they no longer require a legal guardian. Be sure to review the provisions you have made for them and revise them to make them age appropriate.

3) Changes to your estate. Each time you acquire a new asset, a home, a business, a bank account, you need to ensure that it has been added to your Trust. Further, any changes in the value of your estate merit a review of the division of your assets. If you have sold an asset, such as a business or a home, you should reassess your estate plan. The same goes for acquiring an asset, such as an additional piece of real estate.

4) Moving to a different state. Estate planning is governed by state and not federal laws. Each state has its own variations and nuances about what is required in an estate plan. In Utah, for example, a Will is only valid for three years after the testator passes away. In Texas, a will must be probated within four years, but can always be admitted as a “muniment of title.” Also, many states require that a surviving spouse inherit a certain amount of the estate, but the amount varies from state to state. If you have moved, it is important to make sure that your estate plan complies with the laws of the state where you reside.

5) You’ve started a business. If you own a business or plan to open one, make sure that you not only develop a business succession plan, but also decide who will own the business after you are gone. You can even decide who will run your business. Memorialize those plans in your estate planning documents.

When you review your estate plan, pay special attention to:

  • The agents you have designated in your documents. Is the Trustee you appointed still appropriate? Do you want to designate a new Attorney-in-Fact? Anyone you name to take action for you or on the behalf of your estate should be someone you trust implicitly to carry out your wishes.

  • How your assets are titled. If you have a Trust, have you properly entered all of your assets into it by changing the name of their title (for real estate, etc.) or the name of the account into the name of the Trust. Assets only become part of the Trust if they are part of the Trust’s property. If they have not been properly entered into the Trust, they will have to be probated.

  • Your beneficiaries. Do you want to add anyone? Disinherit anyone? Do you want them to inherit a certain amount of money at a certain age? For a certain thing? Having an estate plan, especially a Trust, allows you to creative and specific about the bequests you leave your loved ones.

Your estate plan should change as your life changes. In order to keep it valid and correct, be sure to review it often. If you need help reviewing or amending your estate plan, contact us.




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