The Essential Practice of Regular Estate Plan Reviews

Estate planning is not a “set it and forget it” endeavor. Like life itself,
an effective estate plan evolves. It adapts to reflect changes in personal
circumstances and the legal environment. This dynamic process ensures that your
intentions are honored and your loved ones are protected. To remain effective,
your estate plan requires regular reviews and updates.

Life’s Milestones and Your Estate Plan

As we navigate through life’s significant events—marriage, the birth of children,
significant financial changes—our initial estate planning decisions may no
longer reflect our current needs or wishes. An estate plan created when you
were single might need a different approach once you have a family. Similarly,
acquiring new assets or starting a business can significantly alter the
landscape of your estate, necessitating adjustments to ensure that these assets
are properly managed and protected.

Legal Changes and Estate Planning

Laws related to taxes and estate planning are in constant flux. What was a
tax-efficient strategy a few years ago might now expose your estate to
substantial tax liabilities due to recent changes in the law. Furthermore,
relocating to a new state or country introduces different legal requirements
and challenges that could impact your estate plan. Regular reviews allow you to
adjust your plan in accordance with the latest legal requirements, ensuring
compliance and optimizing for tax benefits.

Designations and Directives: Keeping Them Current

Your estate plan likely includes designations for powers of attorney and healthcare
proxies—individuals you trust to handle your affairs and make medical decisions
if you’re unable to do so. Over time, relationships can change, and the
suitability of your appointed representatives can shift. Regularly updating
these designations ensures that the individuals involved are still the best
choices for these crucial roles, maintaining the integrity and functionality of
your estate plan.

Control Over Your Legacy

Frequent reviews of your estate plan empower you to maintain control over how your
assets are distributed. They allow you to adapt your plan to reflect new family
dynamics, financial changes, or shifts in your philanthropic goals. This
proactive approach minimizes the potential for family disputes and ensures that
your legacy is managed according to your current wishes.

When to Review Your Estate Plan

While the general recommendation is to review your estate plan every three to five years,
significant life events such as a new marriage, divorce, the death of a
beneficiary, or significant changes in financial status provide good reasons to
revisit your plan sooner. These milestones are natural opportunities to reflect
on your estate planning needs and make necessary adjustments.

An estate plan is a critical tool for safeguarding your assets and caring for your loved ones. Treating it as a living document and reviewing it regularly ensures that it continues to serve its intended purposes effectively.