Rumor: “I signed a Will, power of attorney and a living will 15-20 years ago. I’m all set!”
Reality: A lot can change in even just a few years, giving estate plans a limited shelf life.
Think back on the last 15 or 20 years of your life. Chances are, you, your spouse and your family have experienced a lot of changes in jobs, relationships, deaths, births, medical circumstances and more. This is why estate planning is, unfortunately, not a one-and-done activity.
You should review your legal estate planning documents every few years to see if anything needs to be updated. Here are just some of the situations why an estate plan might need to be updated:
- Death of a named beneficiary, trustee, executor, agent or guardian
- Changes to your health or disability
- Changes to your employment status
- The people you selected as trustees, executors, agents or guardians cannot, or should not, serve in those roles anymore due to changes in health, location, etc.
- Acquisition or loss of property, including buying or selling a house, car, etc.
- Minor children are now adults
- Addition of children or grandchildren to the family
- Gain or loss of a pet
- New or loss of insurance policies
- Pension changes
- Social Security benefits changes
- Moving to a different state, which may impact applicable estate and tax laws
- Changes to local, state or federal laws concerning taxes and what must be included in estate plan documents
- Addition of digital assets, such as online financial and social media accounts, and instructions and wishes for accessing and managing those
- A new estate planning attorney
Changes like the ones listed above trigger the need to update estate planning documents, including:
- Power of attorney
- Guardianship appointments under a Will
- Advance medical directive
Outdated estate plans could jeopardize your wishes around how you and your loved ones are cared for. Failing to update estate plan documents may also mean your property may not be passed on as you’d prefer. Further, an outdated estate plan can lead to a legal fight among your loved ones as they work to sort out questions and confusions. These disputes can be costly and stressful.
This is the first in our Rumor v. Reality estate planning series. Watch for additional, helpful estate planning information in the coming weeks!