Estate Planning, When and Why
Estate planning can be an emotional and challenging topic, but it’s critical to complete the process while you still have the chance to do so. Why does everyone need an estate plan, and when should you update it?
4 TIMES YOU NEED TO UPDATE YOUR ESTATE PLAN
Updating your estate plan is critical to make sure that your wishes are carried out. It’s particularly important when major life events happen that might change your priorities and require updating your will or other estate planning documents. What are some of the times that you need to update your estate plan?
Marriage or Divorce
Getting married or divorced can have significant implications for your estate plan. In the case of marriage, you may want to update beneficiaries, add your spouse to your healthcare directives, and create a new trust or modify existing ones. Conversely, divorce may require removing your ex-spouse from your estate plan and updating insurance policies and other documents to reflect your separation.
A Child
The addition of a new family member, whether through birth or adoption, is always a reason to update your estate plan. You'll want to designate guardianship for minor children, update any policy beneficiaries, and consider setting up trusts to manage assets for their benefit.
Financial Changes
Any significant changes in your financial situation, like inheriting a large sum of money or starting a business, should also prompt a review of your estate plan. Adjustments may be needed to ensure that your current estate plan aligns with your financial goals and priorities, as well as that it accounts for increases or decreases in your wealth.
Changes to Your Health
Changes in your health or the health of a family member can require updating your estate plan, particularly if they involve incapacitation. Updating documents like powers of attorney and healthcare directives will ensure that your wishes are carried out.
WHY EVERYONE NEEDS AN ESTATE PLAN
While estate planning is often associated with older individuals or those with substantial wealth, the reality is that everyone, regardless of age or wealth, can benefit from having an estate plan in place. This is particularly true for young families and singles who may not consider estate planning a priority. Why is estate planning so crucial?
Protecting Your Loved Ones: An estate plan lets you specify how your assets should be distributed and who will receive them in the event of your passing. For young families, this is especially important, as it ensures that children are cared for by those you’d like to care for them and that their financial needs are met.
Healthcare Decision Making: What will happen to you if you are unable to advocate for yourself or make healthcare decisions for yourself? Estate plans can include information on what you want to happen In the event of an unexpected illness or incapacitation, like advance directives and healthcare powers of attorney. This is crucial for singles and young adults who may not have close family members readily available to act on their behalf.
Avoid Probate and Delays: Without an estate plan, your assets may be subject to probate, which is a costly and time-consuming legal process. Having a will or other estate planning documents can expedite the distribution of your assets to your beneficiaries.
Peace of Mind: The biggest benefit of having an estate plan is the peace of mind it provides. You do not need to worry about what will happen when you are no longer here.
EXPERT LEGAL COUNSEL AND REPRESENTATION FROM COLLINS LEGAL GROUP
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