Life Changes That Require a Review of Your Estate Plan
Estate planning is when a person develops a strategy for the management and care of their estate if they become incapacitated or die. One of the many reasons that people create an estate plan is to minimize costs and taxes and to avoid probate. However, an estate plan will also name a person to make financial and medical decisions on your behalf if you become unable to do so yourself.
Because a family’s circumstances and needs are always changing, an estate plan should not be a once and done affair. There are certain changes that happen in your life that should trigger you to update and make changes to your estate plan as well. These life changes that require a review of your estate plan include, but may not be limited to, the following:
- Marriage – When a couple gets married, whether it is the first time they’ve gotten married or not, one of the last things they think about is an estate plan. However, marriage is the perfect time to create or update your estate plan. You may need to add your existing spouse to your health and insurance policies and update emergency contacts. In addition, when you die, the assets of your estate may not automatically go to your significant other. If you have a child from a previous marriage, a minor child, or if you have joint assets owned with another person such as a sibling, you need to be sure your assets are going where you want them to.
- Adoption or Birth of a Child or Grandchild – When a new baby enters the family everything changes, and your estate plan should too. Your will, depending on how it is written, may not automatically include a new child. That’s why it is important to check and add the child as one of your beneficiaries. As the child grows in age, you may need to adjust your estate plan to ensure your assets are distributed the way you want them to.
- Divorce – Although some federal and state laws may automatically remove your ex-spouse from an inheritance after a divorce, this doesn’t always happen and you should never take for granted that it does. Immediately update your beneficiary designations after your divorce for all retirement accounts, insurance policies, HIPAA authorizations, health care proxies, and power of attorneys. You should also update your trust and will so that your ex-spouse is excluded.
- Death of a Loved One – If someone listed in your estate plan passes away, you need to be sure that you designate a new person to replace them. This could be a power of attorney, guardian of your children, or health care proxy.
- Change in Assets – If you have obtained an inheritance, purchased a large asset, or had a sudden increase in salary, this should prompt you to adjust your estate plan. The larger the estate, the more likely there are to be issues when the assets are disposed of.
Contact an Experienced Estate Planning Attorney
If you have questions about creating or modifying an estate plan, contact Tampa estate planning attorney David Toback today to schedule a consultation. We have years of experience helping our clients ensure that their estates are protected and will be taken care of the way they want.