An estate plan is not something that people should look at once and then tuck away for safe-keeping, only to be used after they pass away. An individual's estate plan should change just as their family does. It reflects their wishes and instructions for their family, after all.
However, it can be difficult to know when it is necessary to update an estate plan. Here are a few of the most common family events that might require someone to change their estate plan.
1. The end of a marriage
Divorce is not easy by any means. And the process already involves several steps to complete.
However, one step that anyone getting a divorce should consider is changing their estate plan.
Many spouses list each other as beneficiaries or even healthcare agents in their estate plan. And if they get a divorce, it is not likely that an individual would want their ex-spouse to benefit from their now-divided estate. They also probably do not want their ex-spouse to make decisions on their behalf if they suffer an incapacitating injury or medical condition and cannot speak for themselves.
So, it is important to review one's beneficiaries and agents after a divorce to ensure their estate plan matches their current situation.
2. A new family member
An addition to the family could mean a new child or grandchild. It could also include an addition by marriage, such as a new daughter- or son-in-law.
If someone wishes to provide for a family that continues to expand, it is critical to update their will to reflect that.
3. Meet changing needs or circumstances
As people age, their needs change. It may be necessary for individuals to adjust their estate plan to their changing needs—or even their beneficiaries' changing needs.
Some examples of this include:
- Obtaining significant assets or real property
- Losing a substantial amount of assets
- A loved one is diagnosed with a terminal illness
- A beneficiary sustains a life-changing injury or disability
It is also possible to amend an existing plan simply if someone's wishes change.
Family events are not the only reasons to revise an estate plan
Events or changes within one's family only make up a few of the reasons someone should review their estate plan. There are many other reasons, such as changes in New York laws.
However, even though estate planning has many purposes, one of the primary goals is to continue to support the family after death. That is why family changes are some of the most common reasons that New Yorkers rework their estate plans.