June 11, 2024


When Should You Update Your Estate Plan?

An estate plan is arguably one of the most critical aspects of your overall financial strategy. An estate plan is not just about creating a will and trust – it’s about ensuring that your financial legacy lives on to care for family members, contribute to charities, and make a difference after you’re gone

However, estate planning is not a one-step process. After you’ve created the initial estate plan, you will need to update it as your life circumstances and assets change. But how often should this happen?

Below are five different circumstances which may necessitate an update to your estate plan: 

1. Changes to state or federal gift and estate tax exemptions

Most financial advisors and estate attorneys will draft your estate plan in accordance with state and federal laws to ensure your assets are allocated in the best way possible. However, as laws change, your estate plan may become outdated and even leave specific beneficiaries with less than promised if the wording is not updated accordingly. Therefore, you should meet with your advisor annually to ensure your estate plan is up to date for these changes. 

2. Marriage or divorce

If you marry or divorce after your estate plan is made, you should make amendments to reflect this change in life circumstances. In the case of divorce, you may still leave your ex-spouse some inheritance, but this discussion should be held privately with your financial advisor. 

3. Death, change in the ability of a beneficiary, or change in the relationship of a beneficiary

If there are beneficiaries in your estate plan that have passed away, become disabled, or have had significant changes in wealth, you will need to amend your estate plan to reflect these changes. This can also happen if a new child or grandchild is born, if a child gets married, or if a family member becomes estranged.

4. Major changes in assets

You will continue to accumulate assets into retirement, and as you do, these should be accounted for in your estate. Meet with your financial advisor regularly to discuss the purchase of a new property or business, purchasing a life insurance plan, receiving an inheritance, or any other significant change in wealth.

5. A move to a new state or country (or purchase of out-of-state property)

Inheritance laws and estate taxes are different from state to state and should be addressed in your estate plan immediately after you move or purchase out-of-state property. You may be able to benefit from various tax laws when you move, so talk to your financial advisor or a local attorney to see what changes you need to make. 

Why Work with a Providence Financial Advisor

Estate planning is a fluid process that will change just as your life does. OneAscent takes care to reflect these changes in your financial plan, ensuring your financial legacy is taken care of now and in the future. To learn more about estate planning options and benefits, schedule a consultation with a Providence Financial Advisors today.

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