An estate plan allows people to decide how their assets should be managed after they pass away. Estate planning is a lifelong process. Many people update their estate plans regularly throughout their lives.
Knowing when and why you should update your estate plan is important. Here is what you should know:
5 reasons to adjust it
There are a few common reasons people update their estate plans, including the following:
- Asset updates: Many people update their estate plans every three to five years to include new assets, such as real estate, investments and businesses.
- Marital changes: It may be important to update an estate plan if a person’s marital status has changed. A person could include a newlywed spouse as a primary beneficiary of their estate. Or, a person could remove their ex-spouse as their power of attorney.
- Medical changes: People often develop medical conditions as they age. A person may want to consider updating their estate plan if they have developed serious medical conditions. An estate plan can include a power of attorney or a living will to help manage a person’s medical decisions if they become incapacitated.
- Updated beneficiaries: People often update their estate plans when they have a child or grandchild. A trust can be used to help ensure future generations are given an inheritance.
- Asset protection: When making an estate plan, it is important to consider asset protection and tax considerations. A person may want to update their estate plan regularly to protect their estate from disputes, taxes and debt collectors. A trust is a popular estate planning tool people use to protect their legacy.
If you want to learn more about when and why you should update your estate plan, then you can reach out for professional legal guidance.