Do you have a blended family? These five key life events including remarriage might mean it’s time to revisit your estate planning documents.
Having another chance to fall in love is a gift worth celebrating. For many, remarriage after a divorce or the spouse’s death can be the start to a whole new chapter in life. Considering how merging two lives into one will impact your financial situation and estate plan is essential.
There is a delicate balance between embracing the new and knowing what is fair when merging the assets and lives of two established families. Other key life events that affect families, like death, divorce, the birth of a child, and significant moves are other examples of when an estate plan should be revisited and updated.
5 Reasons to Review and Update Your Estate Plan
1. Remarriage
Getting remarried is an exciting time to put the past behind and look forward to brighter days. This is a great time to look at your comprehensive estate plan and decide who will be your beneficiary, who will make your medical decisions if you become incapacitated, and who will be the executor of your estate. Additionally, you want to ensure your spouse is taken care of, including changing any designations on insurance policies or retirement accounts from your former spouse to your new spouse or another beneficiary. A common pitfall in new marriages is getting wrapped up in the excitement of a wedding and not updating the estate plan to ensure your new spouse—and any biological children—are protected.
2. Birth of a Child
If you have children or are expecting the birth of a child, you will need to update your estate plan with directives on who will care for your children if you become incapacitated or die. Assigning a guardian is essential so that you do not risk the court deciding for you. Additionally, your estate plan can lay out how your child will be financially supported and can name them as beneficiaries.
3. Divorce or Death in the Family
Dealing with divorce or death in the family can be heartbreaking, but keeping your estate plan updated to reflect these key life events can allow you to redirect your assets. If you are divorced, changing the beneficiaries on your accounts, like life insurance or any retirement accounts, is essential. You should also review your power of attorney and update your attorney-in-fact, or the person designated to act on behalf of another person. If it is outdated, your former spouse will legally assume the decision-making powers if you become incapacitated. Depending on how things ended between the two of you, it may not be your ideal choice.
If one of your beneficiaries dies, they will no longer be able to accept the inheritance, so you should remove them from your estate plan.
4. Moving to a New State
Estate planning laws are not national and can vary from state to state. You should review your estate plan if you move to a new state to ensure it complies with current laws and regulations. Some states are common law states, and others are community property states, and this can affect how assets and debts are handled in the state you reside.
You should know if the new state will accept your advanced healthcare directives, living will, or medical POA. If there are no laws in the state governing those legal documents, then you risk medical professionals not accepting the documents in an emergency. The terminology might also differ, like “agent” vs “proxy.” To protect yourself from this, go through all the documents in your estate plan and update any that do not meet new state requirements and terminology.
5. Time Lapse of 3+ Years
Reviewing your estate plan at regular intervals, in addition to key life events, will help ensure that your legacy is passed on following your wishes. It also ensures that your beneficiaries receive their benefits without the headache of guessing what you would have wanted. It is common practice to review and update your estate plan every 3-5 years unless a major life event occurs.
The good news is you have already done the leg work of thinking through the structure of your estate plan—the documents are already gathered, and the language already exists. Keeping up with periodic updates will only help make your estate plan more transparent to those you love.
Mobile Estate Planning Made Easy
The process of getting a legitimate will in place for you and your family can be overwhelming, confusing, and costly, but it doesn’t have to be! At Assurest, we offer simple, affordable solutions for your legal needs and make the process easy by coming to you for the conversation—meeting you in your home or, if you prefer, virtually or over the phone.
Serving the Greater Richmond area and beyond, our experienced and trustworthy professionals simplify the process using clear, understandable language free of legal jargon and provide flat-rate packages, so you’re never surprised by the bill. Contact us today and rest assured that your affairs are in order and your loved ones are protected.
Disclaimer: This material is intended for general information purposes only and does not constitute legal advice. Responses to inquiries, whether by email, telephone, or other means, do not constitute legal advice, nor do they create or imply the existence of an attorney-client relationship.