Why You Need to Update Your Estate Plan After These Life Events?

Have you ever had an event, planned or unexpected, make a big impact in your life? It may be that you had a change of heart and want to make changes or one of the following event happened; but having a plan up to date could make the different between success and dissaster.

So, the following are some life events that may trigger an update on your estate plan , or at the least, a good review.

Marriage:

When you enter into a legal marriage (does not matter where in the world), your spouse automatically has certain rights over your inheritance. Depending on your family structure, your spouse may receive everything you own, if something happens to you.

Divorce:

The fact that a divorce is ongoing and pending in court, does not mean that your still-spouse cannot inherit from you. It is important to update your plan while the divorce is pending. You may not be able to disinherit your spouse completely at this point and you won’t be able to transfer assets into a trust, but you may update your Will and leave the minimum only. As soon as the divorce is final, you may want to update your plan documents and the beneficiaries in all your accounts. What’s more important during the divorce process is to update your Health Care Power of Attorney or have one immediately. Your still-spouse is the only one with authority to make medical decisions for you in the event of an accident or an illness if you are unable to do it yourself.

Having a child:

There is more to estate planning than just a Will. A trust plan can make sure that if you have a child (by birth or adoption) and you cannot care for him or her, temporarily or long-term, that the right person can handle assets for the benefit of your child. Likewise, and of utmost importance, designate who will take care of the child for you. Leaving instructions and directions to any care-giver can prevent your child to ever falling into foster care or be subject to family fights.

Having a grandchild:

Having a grandchild may also have an impact in the way you want to distribute your assets, or you may want to indicate who is the right person to manage those assets for the minor child until he or she is mature enough to do it on his/her own.

Change in the Estate:

If your assets significantly change, (increase or decrease), you may want to rethink the distribution of your assets to your current benefiaries or charities.

Medical Condition:

Accidents and diagnosis of medical conditions may happen. If they do, the need for special or specific care may arise and you want to review and update those who would take care of you and who would make medical decisions for you. You also want to make sure that those making decision know how you want those decisions made and when. You may also need to update your plan to provide for medical care for extended periods of time or for long-term care.

Moving:

In the event that you move to another state, it is very important to have an attorney in the new state update your legal plan to comply with the new state’s laws.

Death of a loved one:

In the event a close family member or relative (and sometimes a friend) dies, it is important to review and update your plan. This is specially true with very close family member of home providers. However, always review your plan to see how your life is affected short and long term and how your distributiosn may need be adjusted. The passing of a trustee, decision maker or beneficiary may also be addressed and updated.

Alwasy Review even if an Update is not in order

Reviewing your life, circumstances, and your plan after each one of these major events may cost you little or nothing. Making the right updates and changes when needed can be the difference of having your inheritance go to the right person or have the right person care for your and your children the way you want. Not doing it could cost you money, family conflicts, court involvement, lost of assets or your money going to the wrong person.

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