Reviewing and Updating Your Estate Plan: When and Why It Matters
Estate planning is an important step for you, your family, and your assets. However, many individuals make the mistake of considering estate planning to be a one-time process. This is not true, and an estate plan must be reviewed and updated from time to time to reflect your life, your wishes, and the law.
Why estate plans need regular review
Life doesn’t stay the same for very long, and eventually, a person’s relationships, assets, and the law itself all change in some way. A perfectly good estate plan that was suitable five years ago might no longer be achieving what you want today. Outdated documents can cause confusion, family conflicts, mistaken heirs, and costly taxes.
Periodic reviews of an estate plan are necessary to ensure that it still serves the intended purpose and that you’re achieving your goals with the documents you’ve put in place.
Life events that should trigger an update
There are some events in life that require an immediate review of your estate plan, such as marriage, divorce, the birth or adoption of a child, or the death of a spouse. Changes in health, such as a diagnosis or concerns about future long-term care, are also important reasons to review the plan.
Buying or selling a home, inheritance, starting or selling a business, or significant investment changes are some of the financial events that can affect your estate plan.
The risk of outdated documents
Outdated estate planning documents can lead to significant issues, such as:
- Beneficiary designations for retirement accounts and life insurance that are inconsistent with a Will or a Trust.
- Outdated Powers of Attorney that are no longer valid, such as a Power of Attorney that appoints an agent who is no longer able or willing to serve.
- Outdated estate planning documents that are not valid due to changed laws, causing assets to pass according to state law instead of according to the Will.
Estate planning is more than just your will
A well-crafted estate plan can consist of several different legal documents working together. This may include a will, a trust, powers of attorney, advanced healthcare directives, and beneficiary designations. A review of an estate plan can help ensure all of these elements are working together as a team.
Reviewing an estate plan is an important opportunity for older adults to discuss long-term care planning, asset protection, and Medicaid benefits.
How often should you review your estate plan?
Generally speaking, it is a good idea to review an estate plan every three to five years, even if nothing has changed. This is because laws governing estates, taxation, and elder care are constantly evolving.
A qualified elder law attorney can help identify gaps and changes in your estate plan and advise you about the effects of new laws.
Talk to a Virginia Beach, VA, Estate Planning Lawyer Today
The Law Office of Angela N. Manz represents the interests of Virginia Beach residents looking to draft or change their estate planning documents. Call our Virginia Beach estate planning lawyers today to schedule an appointment, and we can begin discussing your next steps right away.