If you currently have an estate plan in place: congratulations! You are ahead of many Americans when it comes to taking charge of your assets and protecting your family. However, an estate plan is not a “set-it-and-forget-it” document. If you have not updated your estate plan in a few years, it is likely time for you to revisit it.
Most people go through a variety of changes over the span of a few years. You may have gotten married, remarried, or divorced; you may have had children; you may have started a business or changed your investment portfolio; you may have gotten a new job. In many cases, these changes necessitate updates to your estate plan.
What Should an Estate Plan Include?
There are many ways to organize your estate: it is very possible that your estate plan may look different from those of other family members and colleagues. Basic components of an estate plan include:
- A will: a document that will name an executor for your estate and detail which assets you intend to give to which beneficiaries
- A living will: a document that includes which medical treatments you do and do not consent to in the event of your incapacitation
- A health care proxy: designates a person that will make medical decisions for you if illness or injury incapacitates you
- A financial power of attorney: designates a person that will handle your financial affairs if you are not able to act on these yourself
Some estate plans also include living trusts, which may help your heirs avoid probate court, allow you to make charitable donations, and potentially avoid estate taxes. Your needs are unique, and a trusted advisor can help with this.
When Should I Update My Estate Plan?
As mentioned prior, it is always good to revisit your plan every few years, with every 3-5 years being the most ideal. However, there are certain events that necessitate updating an estate plan. For example, if you have moved to a different state, you may need to ensure that your estate plan is valid in your new place of residence. If you are experiencing health changes that have impacted your feelings on end-of-life care, it is time to update your estate. If you wish to use your assets to fund a charity, need to create a business succession plan, or have a new grandchild with special needs, updating the estate plan is a must.
Additionally, even if you are in good health, the unthinkable can occur. Many people put off making changes to their estate documents, assuming that they will not need an estate plan for a while. While this is hopefully the case, if you die unexpectedly and your estate plan does not reflect your current monetary and familial situations, this may cause your surviving beneficiaries problems.
If you have not looked at your estate planning documents over the past 5 years, or if you have gone through significant life changes recently, it is time to take a look at your estate plan. Contact us at AmeriEstate to get the help you need to leave behind the legacy you desire.