It is important to make certain that your estate plan is current and updated. Very rarely do individuals just have one estate plan throughout their lives. As things in your life change, sometimes your estate plan must change as well.
Wills can be changed by drafting and executing a new one, or by amending the will by adding a “codicil.” Codicils are drafted, signed and witnessed in the same manner a will is, and are kept with the original will that is being amended.
You may want to update or change your will when one or more of the following occur.
Your Marital Status Changes
Following a marriage or divorce, it is important to review and update your estate planning.
A marriage can have a significant impact on your estate plan. It is important to review and update your estate plan prior to the wedding, or immediately after. Assuming an individual has a will or trust in place prior to getting married, it is not likely that plan reflects what their wishes would be following their marriage. Furthermore, following the marriage, his or her spouse becomes entitled to a marital share of the estate. It is vital to have an estate plan in order to ensure you are planning for what YOU want regarding your estate.
A divorce also necessitates your estate plan to be updated. If your estate plan is not updated following your divorce, then when you die your assets could be distributed in ways you do not – including to your ex-spouse. It is important to provide a copy of your divorce decree to your estate planning attorney to ensure any agreements in the divorce are reflected in your estate plan if required.
A Child or Grandchild is Born
When a child or grandchild is added to your family, you may need to update your will to add them as a beneficiary. When drafting your will, it is often possible to draft them in anticipation of possible additional children or grandchildren. However, not every situation is, or can be, planned for.
At the very least, when there is an addition to the family, it is important to review your estate plan to ensure that child and/or grandchild is provided for as you want them to be.
There is a Death in the Family
Following a death in the family, your estate plan may need to be revised, particularly if that individual was listed as a beneficiary. Depending on how your will is worded, an individually named beneficiary may not be automatically excluded from inheritance should they die – their share could still possibly pass on to their heirs.
You Move to a New State
Estate planning laws vary from state to state. A will or trust drafted in Minnesota is done according to Minnesota specific laws and statutes.
If the will you drafted in one state was properly done and recognized in that state, it will also likely be recognized in the state you move to. However, for most people it is a good idea to get a new document that reflects the laws of the new state you move to.
The Value and Kind of Property You Own Changes Substantially
If your estate experiences a substantial increase or decrease in size, your estate plan may need to be updated to reflect the change.
If your estate grows significantly in value, there may be new tax issues and complications to take into consideration. Individuals leaving substantial amounts of money to their children may choose to set up a trust so that the inheritance is distributed to the individuals over a period of time rather than just all at once.
On the other hand, if your estate decreases you may need to revise your will. Oftentimes individuals will make specific monetary gifts to individuals or charities in their wills. If these assets are no longer available, the will may need to be updated.
Tax Laws Change
If there are changes in the tax laws, there may also be a reason for you to update your estate plan. Certain changes could undo tax-planning that was done previously. Certain changes may also create new opportunities for individuals to avoid estate taxes. When tax law changes go into effect, contact your estate planning attorney to review if any revisions or updates to your will may be necessary.
Your Personal Representative Moves Away or Dies
The personal representative you name in your will handles all of your assets and estate after you die. Because of this important role, it is prudent to name an individual who lives in the same geographic area, and who is willing and able to serve as personal representative. If the individual you name moves away or becomes unable or unwilling to serve as personal representative, it may be a good idea to update your will and name a new personal representative.
If you are not sure whether or not you need to update your estate plan, take a moment to review your documents and ensure they are still in alignment with your wishes, and your current situation. If you think you might need to update your will, contact an estate planning attorney to revise your estate plan to determine if you need to make any changes or updates. Schromen Law, LLC assists individuals in reviewing their estate plan, and if any changes or updates need to be made, assists clients through that process.
The material contained herein is for informational purposes only, and is not intended to create or constitute an attorney-client relationship between Schromen Law, LLC and the reader. The information contained herein is not offered as legal advice and should not be construed as legal advice.