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Top 10 Reasons to Make Plan Updates


A 2019 study showed that only 18% of people age 55 and older have a complete estate plan that addresses both death and disability (meaning wills or trusts combined with up-to-date health and durable powers of attorney). If you haven’t done any planning yet, you should start now! But, what if you have a comprehensive plan in place already? Over time, life and law changes can occur that may cause your plan to be out-of-date. So, when should you make plan updates?

10. You Started a New Business

Small business owners spend time and energy on starting a business and making sure that it continues to operate and be profitable. However, many business owners fail to consider what would happen if they temporarily or permanently were unable to run their business (perhaps due to disability or death). Every business should have a succession plan in place.

9. Death of a Loved One

When someone who was part of your estate plan dies, you should consider how that affects your wishes and if, or how, that changes your goals at the time of your passing.

8. Law Changes

Laws change. For example, in 1997 $10,000 was the amount of the annual gift tax exclusion, in 2017 it was $14,000 and in 2021 the annual gift tax exclusion is $15,000. Laws change and as a result, your approach to planning should be reviewed taking into account those changes. You should consider working with someone who updates you on law changes. If you haven’t had a review considering law changes in more than five years – you should consider a check up on your estate plan.

7. You Moved to A New State

Every state has their own laws and their own rules for handling matters relating to death and disability. If you move to a new state, it is time to check on your plan to make sure that your wishes are still appropriately planned for in light of the new jurisdiction in which you reside.

6. Marriage

When new people come into your life, your goals and those that you are planning for need to be updated in your estate plan! Consider not only how your new spouse affects your goals and wishes, but how their family may affect your goals and wishes. If you are marrying again, you may need to consider separate children and blended family considerations. If someone in your estate plan is getting married, consider how that affects your goals – for example would you want to provide for the new spouse? If your children are the ones getting married, you should plan for how that new spouse affects your goals and wishes up to and including potentially planning to provide divorce protection for your children.

5. Birth

A new child in the family is exciting! It is also a time to update your plan to include the new addition to the family and address how your goals and wishes have changed. Up until the child turns 18 years old, you should consider who would be their guardian if their parents are disabled or have died. You should also consider whether 18 is the best age at which to pass assets or if planning for goals such as college/career school attendance or age appropriate distributions are better options.

4. Divorce

Divorce can be difficult and stressful. When the divorce is finalized, many people fail to consider the estate planning that was done while they were still married. It is likely that the people you planned for and the goals that you had have changed. Failing to update your estate plan after a divorce can cause headache and additional difficulty for those that survive you.

3. A Child Turns 18

Once a child turns 18 years old, they are legally an adult. While many of us don’t consider an 18-year-old an adult, the truth is parents are no longer legally allowed access to their child’s medical records, to make decisions on behalf of their child, or to direct their lives in a legal manner in any way. Consider having the 18-year-old sign power of attorney documents allowing parents to make decisions in their disability and think about whether or not provisions in an outdated estate plan still apply to the new adult in your life.

2. Health Changes

If your health or the health of anyone that is part of your estate plan has changed, it may be time to review your goals and wishes. For example, if a person becomes disabled, they may no longer be the best choice for an Executor or Trustee or they may need to receive gifts from you in a different amount or in a different way (such as in a Special Needs Trust).

1. Your Assets Change Significantly

Have you received an inheritance, started a new job, lost your job, did you win the lottery, etc.? If your assets and/or financial situation have changed significantly, it is a good time to review your estate plan to ensure that it still meets your needs and goal.

Have you experienced one of the top 10 reasons to update your plan? Contact us to take next steps.

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