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When to update your estate plan

Creating your estate plan is only one step in the process of putting things in place for your heirs. It is equally important that you keep your plan up to date as things change in your life to prevent surprises for your loved ones such as the exclusion of an heir or failure to account for an asset.

Many people struggle with knowing when to update their estate plans. Forbes explains that how often you need to revisit your plan and how often you should make changes will vary depending on your specific life circumstances.

Personal changes

Major changes in your life should signal a change in your estate plan. Death, birth, divorce, marriage or other big events are good times to revise your plan. You may also want to revise if you have a significant change in assets, such as the sale or purchase of a home. Other personal changes that may indicate an update to your estate plan include a move, the death of an executor, the purchase of life insurance or the creation of new retirement accounts.

Legal changes

Revise your estate plan if there are changes to laws that will impact the inheritance of your assets. For example, tax law changes may trigger an update to your plan. If state or federal lawmakers make changes in estate taxes or inheritance laws, then you should consider changing your estate plan to account for this.

Routine changes

Even if you have nothing happening in your life and laws are not changing, it is still a good idea to review your estate plan on a regular basis. You may not even realize that revisions are necessary if you do not take a look at your plan. A good rule of thumb is to make sure you revise your estate plan every three years to ensure you do not overlook something that requires a change.