If you already have an estate plan in place including your will, specific trusts, and special instructions for the care of your property and children, you are in a good place for your future. However, you should not have a set and forget attitude about your estate plan. Complacency about your plan can mean you miss making important updates and revisions as life goes by.
Major life changes can drastically affect your plans for your estate and the stipulations you put in your will. Here are some common life changes that merit revisiting and revising your estate plan.
Divorce is one of the most drastic life changes that will affect your estate plan and will. Consider the following changes when you go through a divorce:
- Custody and care for living children. If you pass away, will your children be safe with their other living parent? If this is not the case, you will need to speak with your lawyer about instructions for their care by another person, if possible.
- Division of assets and disbursement of life insurance. If you die and leave your estate plan unchanged, your ex-spouse might still be the beneficiary of your life insurance policy and have access to your retirement savings and other pensions. If you do not want this to be the case, you need to change your estate plan.
- Personal assets that no longer matter. When you wrote the estate plan, your spouse was likely involved. After the divorce, your financial situation could be very different. For example, you might not have a house that you wish to leave to a child because the house was sold in divorce proceedings.
Another change you might consider making changes to is the power of attorney in a living will. Married people commonly name their spouse as the person who makes financial, business, or medical choices for them if they are unable to do so. After a divorce, you might not want your ex to be the one making the call for you, so choose a different person instead.
Another change that requires you to update or at least revisit your estate plan is marriage. If you were single, divorced, or widowed before getting married again, you might have assets you want to go to your children or to another relative instead of your new spouse. Make your wishes clear in order to divide your wealth and property the way you want.
If someone who has a priority in your estate plan dies before you do, contact your lawyer to make a simple update. This is important if your spouse dies before you do, or if you experience the loss of a child who was to inherit everything you could give them.
For example, if you set up a trust for your child, but they pass away, you must make other plans for the trust.
If you have a child, you will want to add them to your existing estate plan, especially if you already have some children listed as beneficiaries in your estate plan. New children can sometimes be overlooked because parents don’t update their plans in a timely manner.
Finally, if you receive a windfall yourself, your estate plan might need to change. Before, your plan might have been simple, including directions for children and for funeral costs. If you now have greater wealth and investments, you will need to talk to your lawyer about the best way to preserve the wealth for beneficiaries.
For more information on what common changes people need to make to their estate plans over time, contact us at Ivy Law Group PLLC.