When should you review your estate plan? The question begins with the assumption that you have an estate plan. Maybe you don’t; in which case, beginning the journey of estate planning is a very good thing to do. It is important to have an estate plan, but estate planning is not ‘set-and-forget’. It really is a journey that should follow the course of decision-making undertaken as you travel through life and it’s unexpected (or otherwise) twists and turns. This means that revisiting your estate plan on a regular basis is just as important as actually starting the process.
If you have any assets (and most of us do, even they don’t seem like much) and you have any dependents, estate planning is an absolute must. Not having an estate plan in place means that when you die you will not have any say in important decisions about your estate or the guardianship of your children. It’s a good idea to review your estate plan whenever you have a child or grandchild at the least.
Wills, as part of your estate planning, should be reviewed if your circumstances change, or if they change in the lives of those provided for in your will. A good estate plan should evolve with you and those that will benefit from it. While you can make a new will or add an amendment to your will as many times as you like while of sound mind, you can also revoke, or even destroy, your will any time (while of sound mind) before you die. Life circumstances can change quickly and radically and our estate planning should always reflect our current situation and cover our potential ‘what-if’s’.
Even if you do not feel that you have had any significant life-changes, it is wise to review your estate plan every 5 to 10 years. You could be surprised how your circumstances, your thinking and the circumstances of others might have changed over the years.
Why Have Regular Reviews?
Estate planning is meant to help you put in place a plan that means your estate is divided up in the manner in which you choose and to whom, as well as looking after your loved ones when you’re gone. Regularly reviewing your estate plan assists in reducing any potential conflict for your family when you die. If maintaining family unity is your desire, then keeping your estate plan up-to-date is essential. Good estate planning is not just about transferring family wealth but also family values. It is an opportunity to pass onto the next generation the things that are important to you. Reviewing your estate plan regularly communicates to your loved ones that you are aware of changing needs and circumstances. Doing something about it by revising your estate plan is far more helpful and long-lasting than communicated observation about their changing lives or yours. Good estate planning is also deeply practical: what would you like your funeral to look like? Do you want to be buried or cremated? Who should look after your children, if necessary?
When Should You Review Your Estate Plan?
Aside from regularly reviewing your will and estate plan every 5 to 10 years (and some say every 3 to 5 years), there are certain life events that should be a catalyst for another review. Some of these times include:
- when you get married
- when you enter into a de-facto relationship
- when your de-facto relationship breaks down
- when you get separated with the intention of divorcing
- when you are divorced
- when you have children (and then when more children or grandchildren are born)
- when you start a new business
- when you buy a new home or any other significant assets
- when your financial circumstances change significantly
- when any of your named beneficiaries die
- when your named executors, trustees or guardians pass away or become unable to perform the duties required for those positions
- when you get remarried (particularly if there are children involved)
- when you retire
It’s also helpful to review your estate plan if there are significant changes to any estate laws or tax laws that may have implications for you or your beneficiaries. This is why it’s a good idea to have a professional help you with your estate planning documents and their review.
Your estate planning lawyer can help you to ensure that your plan is the best one for you and for your beneficiaries. A comprehensive estate plan will only remain comprehensive if it is up-to-date. Estate planning has two main aims:
- Secure your family’s financial future as best you can with your estate.
- To reduce the chance of conflict and family fights over your estate.
This was Matthew and Jennifer’s intention when they sought the help of a specialist in wills and estates to help them decide the best way to review their estate plan. Matthew’s marriage to Jennifer is his second marriage and he has two older sons by his first. He and Jennifer have one son together who is still very young. By seeking the advice of their estate lawyer, they have put into place a plan that looks after their family while reducing the chance of Matthew’s ex-wife ‘creating havoc with the distribution of his estate’. There is always the chance in the future that the children from the first relationship will not get along with the child of the second marriage and will fight over who gets what share of the estate. This is a very common scenario.
The key steps in developing an exhaustive estate plan include:
- Organising your finances and assets now. If they’re in a mess when you die it just creates angst for those left behind to deal with it.
- Getting it done now. Your estate plan can only have your specific input when you are of sound mind.
- Looking after your dependents.
- Reducing taxes on your estate where possible.
- Having a will and estate plan that is according to your wishes – how you would like your estate to be distributed.
At Estate Battles, one of our specialties is estate planning. Please contact us today to speak to one of our experienced estate lawyers. We offer a free, 10-minute phone consultation.