An estate plan exists to ensure that your assets go where they’re meant to after you pass — without unnecessary hassle, inconvenience, or taxation for your loved ones to deal with. However, a plan is only effective if it accurately reflects the state of your assets and family structure.
If you’ve already taken the time to undergo the estate planning process, you need to know the key life events that merit updating your existing estate plan.
Why Updating Your Estate Plan Matters and When to Do It
The purpose of an estate plan is to protect your assets — and your loved ones. When someone dies and leaves behind a well-crafted estate plan, ownership of assets can make a seamless transition into the hands of the beneficiaries.
An experienced estate planning lawyer can even help arrange your affairs to prevent an estate from being sold to pay off debt, avoid heavy taxation, or bypass long and costly proceedings in probate court.
Certain life events can have a significant impact on the legality of your estate plan. When you don’t make updates as needed, your well-intended efforts might be for nothing. This puts your estate at risk and leaves your loved ones to deal with consequences like probate, legal fees, taxation, and other unwanted inconveniences.
If you want to ensure your loved ones are financially protected, you should make sure to always update your estate plan to reflect the following major life events:
Marriage or Divorce
Spouses have certain rights when it comes to inheritance. If you’ve married, your estate plan needs to be updated to ensure that your spouse is protected after your death. And if you’ve gone through a divorce, you may want to reallocate your assets so that your former spouse doesn’t end up with assets you didn’t intend for them to acquire.
Adoption or the Birth of Children or Grandchildren
If your estate plan doesn’t clearly state how you’d like your assets to be allocated to children and grandchildren, the court will decide for you. To ensure that assets are passed to new additions to the family, always update your current plan after a new birth or adoption.
Purchasing or Selling Real Estate
Real estate is one of the most complicated parts of an estate — and it’s often the reason that an estate passes into probate. Anytime real estate changes ownership, it’s important that your estate plan reflects the changes.
Failing to include the addition of new property in your estate plan can make it nearly impossible for your family to avoid probate court.
Relocations — both to a different state or to a different country — require an update to an existing estate plan. Upon your death, inheritance may be subject to the laws of the state or country in which you currently live — and an estate plan created in another state or country may not comply with the local laws of your new home.
Changes to Your Finances
Any major financial changes need to be reflected in an estate plan. In particular, acquiring new accounts, investments, and businesses should always be included in an estate plan. Otherwise, beneficiaries may face significant challenges as they try to access the assets that should pass to them automatically.
Development of a Medical Condition
Many medical conditions leave you at risk of eventual incapacity. If you’ve been diagnosed with a serious medical condition, make sure your estate plan includes clear directives for end-of-life care and designates someone to make medical decisions on your behalf.
Consult a Holliston Estate Planning Attorney Today
A well-crafted estate plan is the best way to protect the finances of your loved ones — but a plan must be kept updated to be effective.
Whether you’re interested in updating an existing estate plan or you haven’t yet begun the estate planning process, the Deland Law Office can help. We can provide well-crafted solutions to all of your estate planning needs. Contact Deland Law Office today to learn more about your estate planning options in Holliston, Massachusetts.