When Should People be Reviewing Estate Plans?

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Reviewing an estate plan is too often neglected.

Things simply do not improve on their own over time.

Examples of entropy are everywhere.

You know, that good old “Second Law of Thermodynamics” applied broadly?

Weeds pop up in gardens.

Dust accumulates on shelves.

Paint begins to chip and peel.

According to a recent WMUR article titled “The ‘final’ estate-planning step,” estate plans can also lose their effectiveness.

Reviewing estate planning documents is important.
Being prepared for death or incapacity involves reviewing your current estate plan every few years.

Because estate planning is not immune to the impact of time, reviewing your estate plan every few years is important.

Although setting a reminder to revisit your estate plan after a set time period is helpful, there are reason why you might need to review and update your plan earlier.

What are these?

The first has to do with the value of your estate.

Did you receive a significant influx of money through an inheritance, a pay raise, a job change, or lottery winnings?

This shift may require you to adjust your planning to account for potential estate taxes and inheritance taxes.

Fortunately, neither Kansas nor Missouri has a separate estate tax or inheritance tax.

In the meantime, you may need to adjust your income needs and your income levels.

As a result, both your financial planning for your retirement years and your estate planning will be affected.

Entering retirement will necessarily trigger changes to your goals or your needs.

Reviewing your estate plan is essential if there have been major relational and family changes.

These include marriages or divorces as well as births and deaths in the family.

Incapacity and caregiving changes may lead to estate planning documents being updated.

Many people have chosen to purchase, to sell, or to create their own businesses in the past few years or are planning to do so in the near future.

Your business interests and employees will benefit from you reviewing and updating your estate plan and succession planning.

Financial actions like leasing, purchasing, or selling investments or assets can trigger the need for an estate plan review.

Gifting, borrowing, and lending money, or even changing insurance coverage also can impact your estate value and taxes.

Moving or purchasing property or a vacation home in another state may require additional estate planning to incorporate the laws of the additional state.

Perhaps the people you originally selected to serve as your guardian, trustee, or executor may no longer be willing or able to take on these responsibilities?

If yes, then these individuals will need to be replaced.

In addition to personal matters, tax and estate planning laws also change over time and impact your estate planning legal documents.

Reviewing your estate planning documents regularly or after these important changes will help you protect everyone your love and everything you have.

Reference: WMUR (Feb. 3, 2022) “The ‘final’ estate-planning step”

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