Making an estate plan is a milestone that many never achieve. So well done if you have made yours. Yet, the initial drafting of a plan is not the end of your preparation for the inevitable. For the plan to stay relevant, you need to keep it up to date.
It takes minutes to pull your plan out of the drawer once a year and give it a quick once-over. Most of the time, you probably won’t have to make alterations. But, certain events will require you to make significant changes. The following are a few key examples.
Having a child, or adopting a child, can leave you so busy that you do not have time to do much else. Yet, updating your estate plan is essential, and the sooner you do it, the better.
Firstly, you need to name a guardian for your child so that someone has the legal power to look after them should you die before they reach the age of majority.
Secondly, you likely want to add your child to your estate plan. If you already have a will leaving your estate to your (at the time) only child, they have no obligation to share it with any siblings that come along. Unless that is, you alter it to include them.
Spouses typically have a right to inherit something, and you need to square that up with your wishes for any beneficiaries you’ve named in a previous will – such as a child from a previous marriage. If you do not want to make that change, you should discuss it with the new spouse-to-be and have them accept your wishes as terms of a pre-nuptial agreement.
People often give their spouse power of attorney over their financial and legal affairs and health care decisions. Unless you remain great friends with your ex, it’s wise to allocate these roles to someone else. You’ll also want to check there are no assets you have forgotten about where you designated them as the beneficiary – unless you still want them to receive the benefits or assets in question. And even then, it’s a good idea to formalize this decision as intentional, not an oversight, to prevent possible confusion later.
With appropriate legal guidance, you can monitor your estate plan and alter it to ensure it remains current as time moves on.