Estate plans take time to design. A common misconception about estate planning is that it is a one-time deal. Contrarily, it is an ongoing process that people will revisit and modify throughout their life.
While having a strategic plan for the future is an excellent starting point, poorly maintained plans may result in fraud, misunderstanding and loss of control.
Notable life changes can completely alter the function of an estate plan. For example, if a testator gets divorced, they will want to immediately disinherit their ex. If the testator passes away prior to making this change, their ex may still legally receive a portion of the inheritance despite the disintegration of that relationship. These kinds of circumstances can create bitter and costly legal battles, destroy family relationships and compromise the value of an estate.
According to Market Watch, people may need to modify an estate plan if they move to a new state, get remarried, accumulate substantial net worth, suffer a debilitating injury or expand their family by means of adoption or birth. Additionally, sometimes tax laws change which can impact the outcome of a previously-written estate plan.
Forming a habit
People can guarantee that their estate plan lives up to their expectations when they update it regularly. Fidelity suggests that people make a habit of reviewing their plan and changing it as needed. They may follow a quarterly or yearly schedule.
If major life changes impact an estate plan, people should act promptly in making necessary modifications. If these alterations affect beneficiaries or other plan participants, the testator should consider informing those parties of the situation.