If you have completed your estate plan, that makes you one of the just 33% of Americans who have done so. This is an excellent start. However, were you to lock away your estate planning documents in a safety deposit box and never look at them again, you would be setting not only yourself, but also your loved ones up for failure.
Although we make every effort to build flexibility into your estate plan, proper estate planning requires that documents be reviewed based upon time and circumstances.
Time
Although periodic maintenance of an estate plan is usually the last thing on people’s minds, most practitioners will agree that estate planning documents need to be reviewed from time to time. As a general rule, it is good to have your estate plan reviewed by your attorney every five years (at a minimum). Periodic five year reviews will ensure that your documents reflect your current understanding of your estate, your current wishes, and the current laws. If there is a material change in your circumstances, this may call for a review of your estate planning documents within the five-year period.
Circumstances
Although a review every five years is better than nothing, your estate plan must be reviewed when there is a material change in your circumstances. These circumstances can include, but are certainly not limited to, changes in individual circumstances, family composition, family dynamics, and marital status.
Domicile
Laws vary from state to state. Your estate plan was drafted to conform to the laws in the state where it was drafted. If you were to move to a different state, your estate plan may not be as efficient or as effective as it was in the original state the documents were drafted in. Additionally, depending on the state, even if the documents were validly executed in that state, those documents may not hold up in your new state. A good example of this is found in the State of Georgia. In Georgia, the age to create or witness a will is 14 years of age. Most other states require witnesses to be 18 years of age or older. If you found yourself in another state with a will drafted in Georgia there might be questions as to the will’s validity and whether it will be admitted to probate.
Birth
Whether you are expecting or one of your children is expecting, the birth of a child is an excellent time to review your documents. If this is your first child, you need to, at a minimum, decide on guardians and add them to your estate plan. If it is not your first child, it still would be a good idea to review your documents. Perhaps the individual you selected for guardian would be perfect to raise your fourteen year old daughter but they would have trouble raising her and your brand new triplets. If the birth is of your first grandchild, perhaps you now want to modify your documents to provide for your grandchildren’s education. The birth of children, your own or those of your children, is a very good reason to review your estate planning documents.
Death
Death, though an inescapable part of life, can be devastating. Once you have taken the time to grieve, it is likely time to update your documents. Depending on your plan and who passed, you may have to update beneficiaries, executors/trustees, and/or guardians. You may also have to reconsider who is named in your documents to take care of you should you become incapacitated or if you need someone to make medical decisions for you.
Marriage and Divorce
If you are thinking about getting married or ending a marriage, your documents should be reviewed. If you are newly engaged, you may want to make provisions in your documents to provide for your soon to be spouse. You should also consider updating your Health Care Power of Attorney. If the marriage is a subsequent marriage or a marriage with a blended family, your estate plan should also be reviewed to ensure it takes into account your new situation. If you are considering divorce, you should absolutely review your documents. Divorces can be bitter and sometimes drag on for years. Does your current plan match your current wishes? Do you want your soon to be ex-spouse to benefit from your estate? If not, you need to speak with your estate planning attorney.
Finances
If there is a material change in your financial situation, you should not only meet with your financial advisor, but also with your estate planning attorney. Perhaps your investment in DogeCoin finally mooned, or maybe you inherited money from a recently departed relative. Either way, a large financial windfall is absolutely a reason to review your estate plan. Alternatively, maybe you lost significant sums in Terra or had a judgement not go your way. The inverse is true as well, a significant decrease in assets is another reason to review your estate plan.
Other Issues
Over time, folks change. Some may mature, some may not. Some may develop substance abuse issues or issues with creditors. Changes with folks listed in your documents, be they beneficiaries, executors, or trustees, require you to review your documents. In some instances, you can draft protections for those individuals or remove them entirely. The decision is up to you but, either way, such a situation calls for a review of your documents. Although not an exhaustive list of when you should review your estate plan, these topics are a good jumping off point. If you would like to discuss any material changes in your situation or you feel as if your documents are getting a little long in tooth, please contact your JGB attorney to review your documents.