An estate plan is a beneficial legal and financial tool used by many people to protect and plan for the distribution of their estates. To ensure that you and your loved ones receive the benefits of your estate plan, it must remain enforceable and up to date. This means that you need to know when to review and update the plan over time. A detail-oriented Wichita estate planning attorney can help you review your documents and determine what changes may need to be made.
It’s important to review the plan regularly, even when nothing major has changed, to ensure that the plan is in order and reflects your wishes. Many professionals suggest a regular review every 2 to 5 years. Significant changes to tax law or in your personal life can alter the contents of your estate plan, sometimes making it unenforceable. There are certain life events that should trigger you to look over your estate plan and determine what has changed.
Family Changes
Changes in your family can alter your financial situation and who you wish to name as beneficiaries for your estate. Family changes include:
- Divorce: When you get a divorce, your ex-spouse’s position in your life has likely changed. You may wish to remove them as the primary beneficiary within your estate plan or as the executor or trustee. A divorce may also change which family members you want to list as beneficiaries. Your divorce will also significantly alter your finances, and you may list assets in the estate plan that you no longer own. If enough changes have occurred, your estate plan may be legally invalid until you update it.
- Marriage: Both marriage and remarriage can impact your estate plan, as you may wish to add your new spouse to your estate plan or ensure that the children of either spouse’s prior marriages still retain inheritance rights. Often, spouses want to name each other as beneficiary, power of attorney, or executor of the estate.
- Family Additions: This includes the birth of children, the adoption of children, and the marriage of family members. These changes may mean that you want to add beneficiaries to your estate. When you create a comprehensive estate plan with trusts, you can ensure that minor children and grandchildren can inherit when they reach the age of 18.
- Family Losses: The death or estrangement of a family member may require alterations to your estate plan. You may need to change who you have named as trustee, beneficiary, power of attorney, executor, or contingent beneficiary. If you pass on assets to someone who has died, the asset would go through probate and may be passed on through intestate law.
Changes in Your Life and Wishes
As your life and needs change over time, it can impact how you want your affairs handled at the end of your life. This is why a regular review of your estate plan is useful. There are also some significant changes that should prompt a review, including:
- Retirement: After retirement, your finances change significantly, and you likely are drawing from a retirement account. These circumstances should be reflected. Retirement can also impact how you view your needs in the future for care and for providing for your adult children. Setting up medical directives, a living will, and powers of attorney are important if you have not already created them. You want to ensure that your estate plan matches your goals for retirement.
- Moving States: Moving to a new state means new laws and requirements for estate plans, intestate inheritance, and taxes. It’s important to review your estate plan to see how these changes impact your documents. Some state moves may make your current estate plan unenforceable. Moving also changes the assets you have in your estate.
Financial Changes
Your estate primarily works with your individual financial circumstances and how to protect those assets for your loved ones. When your financial situation changes, your estate plan should change with it. For example, if you have received an inheritance, bought a home, acquired a business, or gained any other large asset, you need to update your plan. The loss of a significant asset or gaining significant debt should also be accounted for.
FAQs
Q: When Should You Revisit and Possibly Revise Your Estate Plan?
A: Financial professionals and attorneys tend to say that you should review an estate plan every 2 to 5 years as well as after major life changes or changes in tax law. Having a regular review is important in case you have missed certain changes and if your wishes for your own care or asset distribution have changed over time. Some life changes that may trigger a revision of an estate plan include:
- Getting married
- Getting divorced
- Welcoming a new child to your family
- Moving to a new state
- A minor child or grandchild becoming an adult
Q: What Are the Three Main Priorities You Want to Ensure With Your Estate Plan?
A: Each individual will have their own priorities for an estate plan, and an attorney can help you determine what will benefit those needs. Some priorities when creating an estate plan may include:
- Avoiding probate to save your loved ones time, stress, and expense
- Ensuring your own care if you become incapacitated by providing legal authority to people you trust
- Protecting your assets during and after your life, ensuring that they benefit the parties you wish
Q: Does a Spouse Automatically Inherit Everything in Kansas?
A: If you do not have a will or comprehensive estate plan, your estate is distributed through Kansas’s intestate succession laws. If you have a spouse but no children or other descendants, your spouse will automatically inherit your entire estate. If you have children or descendants, then they will receive half of your estate, and your spouse will receive the other half. Even if this aligns with your wishes, allowing your estate to pass through probate can be costly for your loved ones.
Q: How Can Divorce Affect Estate Planning?
A: When you get a divorce, your financial situation changes significantly. Because your estate plan accounts for the protection and distribution of your finances and assets, it will likely need to change. You may no longer own assets that were in your estate plan.
A divorce may also affect your estate plan if you have your ex-spouse listed in important roles. This may include powers of attorney, trustee, executor, or primary beneficiary. Depending on your situation, you may want to change those documents.
Contact Stange Law Firm in Wichita
When you need to update the documents in your estate plan to match your changing circumstances, the professionals at Stange Law Firm can help.
