Nearly half of Americans who are over the age of 55 do not have a will. Only 18% of people in this age range have the recommended legacy planning elements, which include advanced health care directives and powers of attorney. While it remains uncertain how many people fail to update their estate plan routinely, this is likely also a large number.
Estate planners often must invest a great deal of energy to establish estate and wealth plans that fit a person’s needs and make sure that their estate goals work together. As clients’ situations change, however, they often fail to inform estate planning lawyers so that adequate changes can be made to the corresponding documents.
Life Changes Warrant Updating Your Estate Plan
After the births of new family members, deaths of close loved ones, and even after a divorce, the best practice is to update your estate plan. Over time, parents’ relationships with their children will change. Children can also encounter various problems throughout life that alter the way that a parent wants assets to be distributed. Changes in a child’s life can also end up influencing that child’s ability to act as an agent or trustee of a parent’s estate plan.
Wills or Trusts Do Not Control Everything
Another frequently overlooked estate planning concern is the importance of updating beneficiary designations. Sometimes, clients think that their will or trust will direct what happens with assets that are contained in retirement accounts when these assets are controlled by beneficiary designations.
The Danger of Listing Former Spouses
It is important to consider that it is common for a former spouse listed as the beneficiary of a life insurance policy of a deceased person. Make sure to update every single document if you are pursuing a divorce, so your ex does not get assets you wish to go to someone else. Estate planners often review these issues with their clients when they create estate plans. As much as estate planners try to bring up these issues when estate planning with clients, it’s common for clients to overlook these concerns.
Other Reasons to Update Your Estate Plan
Some of the other reasons why you should consider updating your estate plan include:
- A new marriage
- A new domestic partner
- If a beneficiary has passed away
- If a beneficiary’s situation has changed
- If you have moved to a new state
- If you have received additional assets
- If you want to disinherit a beneficiary
- If you want to name a new trustee
- If you want to add a new guardian for your children
Contact an Experienced Estate Planning Attorney
It can be confusing to decide what estate planning terms work best for you. One of the best ways to navigate this process is to obtain the assistance of an experienced attorney. Contact compassionate estate planning attorney, Jim A. Lyon, today to schedule a free case evaluation.