Ensuring your estate plan is up to date is not just about having peace of mind—it’s a crucial step in protecting your loved ones and assets as life evolves. But how often should you review your estate plan?
Here’s what we recommend.
Regular Reviews Every 3-5 Years
We recommend reviewing your estate plan every 3-5 years. Why this timeframe? This interval allows you to catch changes in laws or personal circumstances that might necessitate updates to your plan. Laws governing estates, taxes, and trusts can change, and your plan should reflect these updates to remain effective and compliant.
Significant Life Events
Additionally, it’s wise to review your estate plan sooner if there are major life events. These events include births, deaths, marriages, divorces, significant changes in financial circumstances, acquiring new property, or even changes in key relationships such as with financial advisors or attorneys.
Why Regular Reviews Are Important
Updating your estate plan ensures that it continues to reflect your wishes and current legal standards. For example, older trusts created before 2012 may need updates to align with current laws and maximize their benefits. Similarly, reviewing and updating beneficiary designations ensures that your assets flow smoothly to your intended recipients, potentially avoiding probate and ensuring your legacy is managed according to your wishes.
Document Freshness
Another critical aspect of regular reviews involves refreshing documents like powers of attorney and health care directives. These documents can "stale" over time, meaning banks, hospitals, and other institutions may hesitate to honor them if they are outdated.
Establishing a Relationship with an Attorney
Creating a relationship with an estate planning attorney before a time of crisis is also beneficial. Having someone who knows your circumstances and preferences ensures that urgent matters can be addressed swiftly and correctly. Whether you are setting up your first estate plan or updating an existing one, having a trusted advisor who understands your unique needs is invaluable.
Conclusion
In conclusion, while there’s no one-size-fits-all answer, we generally recommend regular reviews of your estate plan—every 3-5 years. These reviews help ensure your plan remains effective and relevant, adapting to changes in your life and the law. If it’s been a while since you last reviewed your estate plan or if you’ve experienced a significant life event, now might be the perfect time to take that important step. Contact us to learn more about how we can assist you in creating or updating your estate plan to protect your loved ones and assets today and in the future.
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