How Often Should You Review Your Estate Plan?

HOW OFTEN SHOULD YOU REVIEW YOUR ESTATE PLAN?

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An estate plan isn’t a one-time thing, written just to be set aside to collect dust. Life changes. Laws and regulations change.  And it is important for you to understand when those changes could affect your estate planning documents.

Reviewing your estate plan regularly and during major life events, regardless of the last update, will help make sure your affairs are in order.

Here’s everything you need to know about when you should review your estate plan, or at least reach out to your estate planning attorney to find out whether you should revise your plan.  

Conduct Maintenance Reviews of Your Estate Plan Every 3 to 5 Years

Everyone with an estate plan should regularly sit down with their attorney to review their documents, but the frequency depends on each individual plan, as well as what is going on in your life and the life of your family.

For example, one person might request to go over their plan every year. Others might do a bi-annual review. Many wait five or more years between reviews. However, the general expert recommendation is to check in on your estate plan at least every three to five years.  

Pick a time frame you and your attorney think is best, but understand that because laws change, regular estate plan reviews really should be done no fewer than every five years so that you can keep pace with updated regulations and laws. This doesn't mean you have to re-write your estate plan every three to five years- what it does mean is that you should check in with your estate planning lawyer to (i) find out if there have been any changes in the tax or inheritance laws that might affect you; and (ii) let him or her know about any significant changes in your life and family circumstances and ask whether any of those changes affect your current plan.

Review Your Estate Plan When There Are Financial Changes

If major financial changes occur in your life, you should update your estate plan. But what qualifies as a major financial change?  They include updates in the following areas:

• Your/your spouse’s career or business
• Your/your spouse’s financial goals
• Long-term insurance coverage
• Federal or state laws involving taxes and investments
• You/your spouse receive an inheritance that substantially changes your asset picture

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​Your estate plan should also be reviewed if you purchase large asset like a home, or if you borrow a large sum of money.

You also may wish to review your plan or make changes if the financial situation of your heirs changes.  

Review Your Estate Plan if Family Changes Occur

Other life events include major family changes, usually relating primarily to children or changes in your marital status.  For example, the birth or adoption of a child or grandchild often requires an update to your estate plan. Not only can you create an inheritance for them, but you can name guardians or set up trusts, too.

Aside from the birth of a child, when else should you review your estate?

•      When a child is adopted, by you or one of your heirs
•      When your child or grandchild comes of age
•      When funding is needed for your child or grandchild for expenses like education
•      When death or changes in guardianship occurs
•      If family members pass away or become disabled
•      If your executor, trustee, durable power of attorney or health care proxy changes or passes away

​Your estate planning needs will also naturally change as time passes, and your children get older.  The careful plans you made for the care of your children when they were toddlers may not be what you need or want when they graduate from college, or start their own families.  You may also need to review your life insurance policies and plans for assets after you are done paying for college and other large expenses.  

If Marital Circumstances Change, Review Your Estate Plan

Finally, you should review your estate plan if anything regarding your marital state changes.
Usually, this is necessary if you get married or divorced or if illness, disability or death of your spouse occurs.  In the case of a divorce, it is likely that your original estate planning documents included your spouse as the first-line personal representative, health care proxy, and power of attorney.  Though it is certainly your choice to leave these designations in place, it is usually not what people want after a divorce.  In the case of marriage, especially re-marriage after a death or divorce, you will want to make sure you are providing not only for your new spouse, but for any children you may already have from a prior marriage.

What Kind of Changes Might You Make to Your Estate Plan?

Ideally, your original estate plan was written in a way that provides generically for your children and descendants, so that if you have another child, or if you have a new grandchild, you do not necessarily need to make changes.  This works when your plan is to divide everything evenly among your children or their children- if you have made specific allocations in your original documents, you will need to amend the documents when new children and grandchildren come on the scene.

In the case of divorce or death of a spouse, there are likely a number of documents where you have named that individual, such as your designation of a personal representative in your will, your health care proxy, and your durable power of attorney.

You do not necessarily have to re-write your entire estate plan.  Many changes can be made through the use of a codicil, a document you attach to your original will that specifies the changes you wish to make.

It’s imperative to have your attorney’s help when you review your estate plan. If you are experiencing a life event or are ready for a regular review and you’re looking for a trusted, experienced team to stand by your side, contact the SLNLaw team today!


Blog Reader Special:  We are offering all blog readers a 10% discount on our estate planning rates. Best of all, the first step — a consultation to assess your needs — is absolutely free!

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