After creating your estate plan, you cannot simply set it aside and forget about it. Your estate plan must constantly reflect the most recent circumstances in your life. This can sound daunting though, especially if your life often undergoes big changes.
To that end, how do you know when it is time to review your estate plan? And do you need to edit or update it every time you review it?
Prioritize reviewing parts of your estate plan
Forbes looks at several parts of your estate plan that you should review sooner rather than later. First, note that experts believe you should review the plan in its entirety every 3 years. You can use this as a general guideline if you do not foresee many life changes happening.
If you do not want or need to review the entire plan, you can focus on the parts Forbes mentions. This includes:
- Your will
- Your healthcare proxy and power of attorney
- Your trust
- Your listed beneficiaries
Update for financial and family changes
In essence, you want to make sure your finances are up to date. You want your end of life plans to reflect your current desires. Perhaps most importantly, you want your beneficiaries to include only people you want your assets going to.
As such, you also want to review your plan any time you face significant change in family or finances. This can include the loss of a loved one or a divorce. It can also include marriage, the birth of a child or adoption.
As for finances, you want to reflect both positive and negative changes. Edit your estate plan if you lose or gain a great amount of assets. You should seek to edit your plan immediately for big changes. Smaller ones can wait a little longer, but you do not want to get caught unprepared.