If you do not already have an estate plan, it is past time to start the process, but never too late. However, if you do already have an estate plan, you may need to update it. Wills and other estate planning tools need periodic updates in order to continue to be relevant.
You may be wondering when you should make changes to your estate plan. Should you do it every five years or every 10? There is no set time as to when you should update your will or other estate plan, but there are certain life events that signal it might be time to make a change.
Marriage or divorce
If your marital status changes, you should make some updates to your estate plan. Whether you get married or divorced, your financial situation is going to change. You might have more property or less property. You may need to set up a trust for your spouse in case you pass away unexpectedly. Or, you might want to protect your children's inheritance if you are working toward a second or even third marriage.
You have more children
If there is a change in your beneficiaries, such as the addition of another child, this is a sign that you may need to make an update to your estate plan. As your family grows, you will want to make sure that their interests are protected. By making the necessary changes to your estate plan, you can guard your legacy for their future.
Your financial situation changes
Whether you come into a large sum of money, perhaps through an inheritance, or you lose out big in the stock market, a major change in your financial situation is a cue that you should update your estate plan. When drastic changes like this take place, you may need to use either more advanced estate planning tools or perhaps reorganize how you would like the estate to distribute your property to your beneficiaries.
You have a health scare
If you suffer a sudden accident or there is a change to your health, you may want to update your estate plan by including a medical power of attorney, living will or a medical directive. A health scare is usually a wake-up call that there might come a time when you cannot make certain decision for yourself. In case that ever happens, you can put in place certain documents that include your instructions, wishes and the person you trust to carry them out.
An estate plan is a very important tool that can protect you and your family if something unexpected happens. If any of the above events happen, take them as a sign that it is time to update your will and other estate plan documents.