When Should You Revise Your Estate Plan?

If you have completed your estate plan, you’re already a step ahead of many Americans. In fact, as many as 60% of adults in the United States don’t have a will or living trust in place. And many of the individuals who do decide to create an estate plan never revisit it once it’s finalized. However, this can be a mistake that can greatly complicate the administration of your estate upon your death. You should know that there are critical times when you should revise your estate plan. If you experience any of the following scenarios, it’s a good idea to meet with your Bakersfield estate lawyer to ensure your estate plan is up to date.

1. Getting Married or Divorced

Of course, you’ll want to be certain that your assets will go where you want them to—so it’s crucial to revise your estate plan after a marriage or divorce. It’s also recommended to revise your plan in the event that your spouse happens to pass away before you so that you can re-allocate your assets to your other loved ones.

2. Having Children

Leaving behind something for their children is important to most individuals who build an estate plan. However, some people may have children, create an estate plan, and then later have another child but never revise their plan. This scenario leaves the child unprotected when you die, so it’s essential to ensure your estate plan is revised when you have a child, adopt a child, or have any grandchildren or great-grandchildren you might want to include in your estate plan.

3. Experiencing Major Changes to Assets

An estate plan typically includes all countable assets, including real estate, checking and savings accounts, retirement funds, stocks and bonds, and other valuable property. If you buy or sell a property, set up a new financial account, or receive a significant sum of money, your estate plan should be adjusted to account for these changes.

4. Moving to a New State

Estate planning laws can differ from state to state. If you plan on moving from California to another state, consult with your lawyer to make sure you’re covered under the new state’s laws.

5. Setting Up or Changing Retirement Plans

Estate plans often include retirement accounts like Individual Retirement Accounts (IRAs) and 401(k) plans. If you establish or change one of these accounts, such as rolling your 401(k) over into an IRA, you will need to revisit your estate documents. Also, keep in mind that retirement accounts have you select a beneficiary that’s separate from the beneficiaries you list in your estate plan. Whenever you’re revising your estate plan, you should also ensure the beneficiary documents are updated with the account provider.

6. Needing a New Executor of the Estate

There are times when you may need to choose a new executor for your estate. This person will be responsible for managing the estate and carrying out the terms of the will. They will handle final affairs, like paying off debts and closing accounts, and ensure that assets are distributed according to your wishes. If you have a trust in place, the trustee you name will fulfill a similar role. This is why it’s so important to select someone who you can trust. If the individual you originally selected loses touch with you or dies, you should revise your estate plan as soon as possible to make sure you have the right person in charge of your assets.

What to Include in Your Estate Plan

As you review your estate plan, you may be wondering if you have accounted for everything. Here are the most important components of every estate plan.

• Will or Trust

It’s a good idea to establish a will or trust even if you don’t have significant assets. Creating a will ensures that your property is distributed according to your wishes and also allows you to select a guardian for any minor children you have at the time of your death. However, some individuals also choose to establish and fund a trust if they have substantial assets. Trusts can help loved ones avoid the expensive and time-consuming probate process they would otherwise have to undergo with a will.

• Durable Power of Attorney

This document will allow you to select a person who can act on your behalf in the event that you become mentally incompetent. They will be able to manage your personal and professional financial affairs as if they were you. This means that they can handle real estate transactions, pay bills, and make other decisions regarding your estate. This person is often a spouse, adult child, or close friend.

• Healthcare Power of Attorney

Your Healthcare Power of Attorney will assign a person to make medical decisions on your behalf should you become incapacitated. This person should be someone who understands your wishes and who you can trust to act accordingly.

• Beneficiary Designations

If you don’t name a beneficiary to your estate, the court could end up deciding what happens to your assets. They may select someone you may not have necessarily wanted to inherit your property. To avoid this scenario, you should designate one or more heirs to your estate.

Bakersfield Estate Planning Attorney

An estate lawyer can help you revise your will or trust to secure your assets and ensure your final wishes come through fruition. At the Law Office of Kyle W. Jones, we handle the estate needs for residents of Bakersfield and the surrounding areas. We’ll work with you to establish a comprehensive estate plan at any stage of life. Contact our firm today to set up a consultation.

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