Estate planning documents require a periodic review

Is it time to update your estate plan?

Is it time to update your estate plan?

Christine R. Settle |
Posted on Nov 30, 2020

If you have taken steps to obtain and complete estate planning documents including a Last Will & Testament, Powers of Attorney (POA), and Living Will, then you are on the right track to ensuring your estate is properly executed according to your wishes. Yet, it’s important to note these documents are not “once and done” and do require a periodic review. 

Many estate planning professionals -- such as attorneys and financial planners -- recommend a review of these documents every three to five years or any time you experience a major life event. Below are six reasons or circumstances for which a review would be appropriate. 

  1. Marriage or Divorce. Changes in family relationships trigger an immediate need to review your estate plan to include a new spouse or to remove a former spouse.
  2. Children. Make sure your legal documents include specific language for any children including biological and/or adopted children, stepchildren, as well as any you may want to disinherit. Additionally, as children are born and grow up, it may be necessary to update the documents to include named guardians for minors or perhaps altering the age requirements for children to receive funds.
  3. Tax Changes. If you have moved from one state to another, state laws may differ and may continue to change. Federal estate tax exemptions may change, too. Although your Last Will & Testament may likely remain valid between states, many other legal documents may be more state specific such as a POA or Living Will. It’s best to consult an attorney in your new state for guidance.
  4. Beneficiary Changes. Over time, your preference for named beneficiaries may change. Children are born, parents or siblings may pass, and your direction for philanthropic gifts may evolve to accommodate something new. Changes in your Last Will & Testament or other estate planning documents can be completed by consulting your attorney. It’s also important to remember that retirement accounts, annuities, and life insurance plans have direct named beneficiaries and any changes must occur through the account administrator of record.
  5. Health Changes. If you or your spouse experience a significant health crisis, your estate plans could be impacted significantly -- based on the cost of healthcare and treatments required -- and could ultimately affect your asset distributions. 
  6. Asset changes. If you experience a change in assets -- positive or negative -- it’s prudent to review your estate plan. For example, if you receive an unexpected inheritance, you may need to reconsider your named beneficiaries or how and when they receive funds. On the flipside, significant unplanned expenses could change your final wishes as well.

These are just some of the reasons to review and update your estate planning documents, but you may have a few unique circumstances of your own. It’s best to address the large events and life changes as they occur, rather than risking a plan that doesn’t truly reflect your intentions. 

It is always recommended you seek the advice of your attorney and/or trusted financial professional when planning for the future. Like other financial institutions with trust powers, the Bank can assist in estate planning matters with experienced staff to serve as a professional fiduciary in the capacities of executor, trustee, and/or financial power of attorney for individuals in our community. 

Estate planning can be overwhelming and isn’t always the highest priority in life. Give yourself peace of mind and consider reviewing your own estate plan now as we approach the New Year. 

Christine R. Settle
Vice President/Trust Officer