Estate planning is a vital aspect of managing your financial affairs and ensuring the fulfillment of your wishes after you pass. However, maintaining an estate plan is not a one-time task.
Life is constantly changing, and so should your estate plan. To help you stay on track, keep in mind some key lifetime milestones when you should consider updating your estate plan.
Marriage
When you tie the knot, your life takes a significant turn. You likely want to make sure you provide for your spouse in your estate plan. This may involve updating your beneficiaries, revising your will or establishing joint ownership of assets.
Divorce
When a marriage ends, you should consider adjusting your estate plan. You may no longer want your ex-spouse to inherit your assets, so you should update your will, beneficiary designations and any powers of attorney accordingly.
Welcoming a child
The arrival of a child is a joyous occasion, but it also comes with new responsibilities. Ensure that your estate plan includes provisions for the care and financial well-being of your children. It is also wise to set up trusts for their future education and appoint a secondary guardian.
Changes in health
Your health can change over time, affecting your ability to make decisions or manage your affairs. It is important to have up-to-date documents including a durable power of attorney and advance healthcare directive. These documents serve to appoint someone you trust to make decisions on your behalf.
Retirement
As you approach retirement, your financial goals and priorities may shift. Updating your estate plan at this stage can help you create a distribution strategy for your retirement accounts and ensure your financial legacy aligns with your retirement plans.
A recent survey finds that approximately 67% of Americans do not have an estate plan. If writing a will seems daunting, keep in mind that starting the process with a simple estate plan is easy. You can then update your will throughout your life as circumstances change.