Keep life events from derailing your estate decisions
If you experience a major life change, one of your top priorities should be ensuring your estate planning documents are kept up to date.
Let me tell you a brief story: I once encountered a situation in which both parents died suddenly. They had three children. Each had a child from a prior marriage and they had a child together. They died intestate, which means that they had no Will. They had not added the youngest child as a beneficiary of their life insurance policies. Therefore, the two older children received the life insurance and the youngest child received nothing from the policies.
In addition, because they had no Will and had not named a guardian for the children, the families involved disputed over who would take the children. The husband’s family wanted one child, but not the other two, and visa versa. This created a prime scenario for a very contentious and sad custody dispute for these very young and grieving children.
The example above should illustrate exactly why it’s important to keep documents up to date. When you experience any major life event, such as a marriage, buying a house, a terminal illness, an heir dies, divorce, birth of a child or grandchild, death in the family, etc., you should review and update your estate documents as well.
Allowing your will, trust, or powers of attorney to go out of date means risking mistakes. Once the documents have been filed and made valid, then executors and personal representatives must follow the instructions held within the most recent versions of the estate plans.
In addition, if there have been changes in the law that might affect your estate plans or changes in tax codes, you may want to revisit what you have directed in the latest version of your plans and make any changes necessary. A lawyer will know best if there have been legal changes that would affect your particular situation.