In simple terms, an estate plan serves as your final instructions for how certain people would handle your finances and assets when you’re incapacitated or dead. Having an estate plan also helps streamline the probate process so that your assets are properly distributed.
But life is a journey of constant change, and your estate plan should reflect this dynamic nature. It’s not merely a document to set and forget; it’s a living set of instructions that must evolve with you.
The when: Recognizing the signs for an update
Significant life events like marriage, divorce, the birth of a child, or the acquisition of substantial assets are clear signals that your estate plan needs a review. Additionally, if you move to a different state or if there’s a change in the law, your estate plan may require adjustments to stay effective and valid under the current legal framework.
The why: Keeping your legacy intact
An outdated estate plan can lead to unintended consequences, such as assets passing to former spouses or your plan deviating from your true intentions. Changes in California law can also affect the distribution of your estate. By updating your estate plan, you ensure that the executor administers your plan according to your most current wishes and that your beneficiaries receive the assets as you intended.
Fortunately, California law allows persons to revoke or amend their wills and trusts.
The how: Step-by-step adjustments
The following are some steps you can take to update your estate plan:
- Revisit your instructions: Take another look at your will, trust, power of attorney or advance health care directive. If your circumstances have changed – whether related to your finances or health – these elements may need updates.
- Evaluate the key roles in your plan: You might also want to reevaluate your choices for executors, trustees, and guardians. Are they still the best fit for their roles?
- Review your assets: Check your asset list once more for any new acquisitions or disposals. The value of some of your assets may have also changed since your last assessment.
Regularly updating your estate plan ensures that the key persons you’ve appointed will handle your personal and financial matters according to your current wishes, providing peace of mind to you and your loved ones.
If your plan needs major changes, you might need some assistance. A legal professional with estate planning experience may be able to guide you through the update process and help you produce a codicil to modify or amend your plan.