How Often Should You Update Your Estate Plan?

Signing your estate planning documents and completing the process that brought you to that point is a great feeling. Unfortunately, just because you’ve completed your estate plan doesn’t mean you’re done with estate planning.

Estate planning is a lifelong process that should be reviewed periodically after completion. Even if you’ve had no major changes in your life recently, it’s smart to review your documents at least once every three to five years to ensure that your plan remains aligned with your wishes.

Read on to learn more about when it may be a good time to review your plan.

Key Life Events

The most pressing reason to update your estate plan is after a major life event that could affect how your plan is structured. Here are some common examples and why they may lead you to review your plan:

Marriage or Divorce

Most people will want to add a new spouse (or remove an ex-spouse) as a beneficiary of their estate and potentially as a fiduciary, such as an executor or agent under a power of attorney.

Birth of a Child or Adoption

Adding a new member to your family often requires updating your beneficiaries, naming a guardian, and making sure that any minors receiving an inheritance are properly protected.

Significant Change in Assets

Acquiring significant new assets may change many things in your plan, from tax exposure to probate issues to how and when assets should be distributed to your heirs.

Moving to a New State

Many estate planning laws are state-specific, including estate tax laws and probate procedures. When you move to a new state, you should review your plan to make sure it still operates as intended.

Death or Change of a Beneficiary or Fiduciary

If you need to change who will receive an inheritance from your estate or who will play a role in administering it, your documents should be updated.

This list is not exhaustive. The main thing to understand is that your estate plan is not static, and its success depends on keeping your documents up to date and aligned with your goals as your life changes over time.

Less Obvious Reasons to Update Your Estate Plan

In addition to major life events, there are less obvious situations where a review may still be necessary:

Outdated Fiduciaries

Often, the person you initially name in your estate plan is no longer the best choice for a certain role. They may be older, not healthy enough to serve, have moved out of state, or are no longer the right fit. It is important to make sure the people you name in your estate plan are ready and willing to serve when needed.

Guardians No Longer Appropriate

For example, many people name their parents as guardians when their children are young, but ten years later those same people may no longer be physically capable of raising a child.

Changes in Asset Structure

For example, if you decide to use funds from a financial account to purchase a rental property, that change can have secondary effects on your estate plan, including creating probate issues in another state.

Changes in the Law

Estate tax laws, probate laws, and rules regarding retirement accounts and required minimum distributions can all change over time, and those changes can significantly affect your estate plan.

Again, this list is not exhaustive. It is meant to give you a sense of how to think about your estate plan: as a set of documents built around your life and goals, with the understanding that those documents should change as your life and goals change.

Conclusion

Estate planning isn’t about predicting every possibility. It’s about staying current. If it’s been a few years since you reviewed your plan, it may be worth having a brief conversation to see whether any updates are needed.

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