Estate planning is a process that allows people to instruct how their assets are distributed after death. An estate plan can include many crucial decisions such as a will, executor of the estate, power of attorney and trusts. Many people benefit from making their estate plans early in case a tragic accident or medical condition would claim their lives.
When an estate plan is made, it can be updated. It’s typical for people to update their estate plans every three to five years. An updated estate plan can include new investments.
Why would you update your estate plan early?
While you may let a few years pass before you consider revising any decisions in an estate plan, it can help to make changes earlier. Here are a few scenarios that can lead people to update their estate plans:
- Marriage: Some people may include their spouse in their estate plans to inherit the testator’s assets. This way there is no confusion as to who would benefit from the testator’s estate. One additional change that may be necessary for testators is to name their spouse as a power of attorney. A power of attorney represented by a spouse may have a better idea of what decisions should be made on behalf of the testator.
- Divorce: The above changes may need to be rectified if a spouse is no longer trusted to be a representative or beneficiary in an estate plan.
- Childbirth: People who have children may consider creating trust funds. Trust funds could be used for the testator’s children’s future endeavors. Before a testator’s children grow up, it may also be beneficial to name a child guardian in an estate plan. A child guardian could have the same rights as a parent in the event of their death.
It’s important that testators understand when it might be necessary to update their estate plans. If an estate plan is outdated at the time of the testator’s death, then their last wishes may not be fulfilled. When it’s time to update an estate plan, it can help to have legal guidance.