If you have created a comprehensive estate plan you are doing better than over half of all Americans who, studies show, have yet to create theirs. Just because you are ahead of the game, however, doesn’t mean you can stop there. Creating your estate plan is only the first step in protecting yourself, your assets, and your loved ones. The next, and most important step is to review and revise your estate plan on a regular basis and when events require it. Of course, it helps to know what events should cause an estate plan revision. While there may be others, the following are common events and changes in your life that warrant a review and possible revision of your estate plan.
Marriage – your marriage, or the marriage of a beneficiary.
Divorce – your divorce or the divorce of a beneficiary
Birth or adoption – although yet to be born beneficiaries can be included in generic terms, it is always best o include them by name once they are actually born
Death – death of a beneficiary obviously calls for a revision; however, so does the death of a Trustee, Executor, Guardian, or anyone else who holds a position in your estate plan.
Major change in assets – a well drafted estate plan will account for future changes in your asset structure; however, major changes warrant at least a review of your plan to see how the change impacts your overall plan.
Move out of state – wills, trusts, and estates are governed by state laws as well as federal laws. Therefore, a move to a new state requires you to review your plan to account for any changes in state laws that affect the plan.
Started or sold business – business succession planning should be included in your overall estate plan if you own a business. Therefore, starting one or selling one will call for a changes to your plan.
Illness or incapacity – if a beneficiary is diagnosed with a serious illness, or suddenly becomes incapacitated, you may need to make changes in your estate plan to account for his or her long-term care.
Change in the law – laws are always subject to change. When a change in the law impacts your plan it is time to revise your plan.
Passage of time – even if none of the above events has prompted a review of your estate plan you should do so every three to five years anyway just to make sure everything is current and you didn’t overlook an event that should have caused a revision.
Even a well thought out and expertly drafted estate plan can fail if a life event caused the plan to become ineffective. For this reason, be sure to make necessary revisions to your estate plan by consulting with your New York estate planning attorney on a regular basis.
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