Life is full of changes, and with each significant milestone, your estate plan should evolve to reflect your new circumstances. Whether it’s a joyous occasion like a marriage or the welcoming of a new family member, or a challenging event such as a divorce or the loss of a loved one, these moments can significantly impact your estate planning needs.
At Safe Harbor Law Firm, we understand the importance of keeping your estate plan aligned with your current life situation. In this post, we’ll explore five key life events that should prompt you to review and update your estate plan, ensuring your intentions are always clearly represented and your loved ones are protected.
Starting a New Job or Career
Starting a new job is an exciting time. You may overlook your retirement account beneficiary forms. This can happen in the rush of new paperwork you fill out. Whether you are bringing accounts from a previous job or not, now is a good time to set up your beneficiaries. Designate primary and secondary beneficiaries for your retirement accounts. Also, do this for any life insurance policies provided by your company.
Note: Retirement accounts and most life insurance policies pass outside of probate, so naming your intended heirs for these assets in your will is not sufficient. Review beneficiary designations yearly.
Buying a House
A house is likely the biggest investment you’ll make. It’s not just a place for you to live, but it’s a place to raise your family and an asset that appreciates over time. You may need to adjust your estate plan to verify that it is distributed to your chosen loved ones after you pass.
Some estate planning strategies such as a transfer-on-death deed allow your spouse to remain in the house and take over ownership without going through probate. You may also need to adjust your life insurance policy coverage so that your family has liquid assets to continue paying the mortgage should something happen to you.
Marriage or Divorce
Two of the biggest life events that lead to estate plan revisions are marriage and divorce. When you marry someone, you should consider a united estate plan that addresses concerns such as:
- Healthcare documents that explain your wishes for future care
- Power of attorney documents naming your spouse or other trusted person as your decision maker should you become incapacitated
- Asset distribution for children from previous marriages, where applicable
- Beneficiary designation updates on life insurance policies and retirement accounts
Note: One common mistake is to forget to update these documents after a divorce. If your spouse is still listed on powers of attorney or beneficiary forms, they are legally entitled to serve in that role or receive those assets. Meet with your lawyer for a full review of your plan.
Death/Health Changes in a Family Member or Appointed Person
If you have someone named as an executor, trustee, power of attorney agent, or beneficiary and they pass away, you need to update all associated documents to name someone new. Even if your documented person is still alive, they may be unable or willing to serve in this role due to a range of issues. For example, if your power of attorney agent has been diagnosed with dementia, you may wish to revisit your plan.
Birth or Adoption of New Family Members
Adding new family members is always exciting, but it calls for a review of your asset distribution plan. You may also need to name a guardian for your minor child in your will to ensure that your chosen person is able to step into this role quickly should something happen to you and any other parent. As with buying a house, you may also want to re-evaluate your existing life insurance coverage.
The Importance of Updating Your Estate Plan
Keeping your estate plan up-to-date ensures that your assets are protected and distributed according to your wishes, thus providing peace of mind for you and your family. Life changes can greatly affect your financial and personal priorities. An updated estate plan helps avoid legal issues and probate problems. It also secures your family’s financial future.
Safe Harbor Law Firm is dedicated to helping you navigate these life changes with ease. Our skilled attorneys are here to help you update your estate plan. We will make sure it matches your current situation and future goals.
Don’t wait until it’s too late. Contact Safe Harbor Law Firm today to protect your family’s future. Let us be your trusted partner in navigating life’s changes and ensuring your peace of mind.
