The popularity of estate planning saw an unprecedented increase in the past year, with more families creating or revisiting their estate plans than ever before.
Having an estate plan is a great way to protect your assets, your wishes, and your loved ones.
The trick is making sure that you have everything covered and that you review your estate plan every few years to ensure that it still reflects your needs and desires.
We’re here to provide you with a comprehensive estate planning checklist and a guide to the four biggest signs that your estate plan needs to be updated. Keep reading to find out more.
The Essential Estate Planning Checklist
First, let’s start out with the estate planning checklist. One of the biggest signs that your estate plan needs to be updated is if you’re missing one of the items on this list. Let’s dive in!
- Determine your estate planning goals
- Make a list of your assets, including both liquid and fixed assets (eg real estate, cars, stocks and bonds, and high-value items)
- Identify the risks that may affect your assets
- Make plans to protect your assets from the risks you’ve identified
- Make a list of the loved ones you want to provide for with your estate plan
- Make a list of any charitable donations you want to contribute some of your assets to
- Identify any special needs your inheritors and benefactors may have that you will want to account for
- Account for any estate tax you may owe
- Account for the probate process and protect against it if possible
- Make a plan in case you become incapacitated by selecting a financial and medical power of attorney
- Get any additional coverage you may need to protect your loved ones, including life insurance that will help cover outstanding medical expenses or funeral expenses
- Determine any legal protections you may want or need
- Finalize all documents and legal processes, including your will, trust, and more
By following this checklist, you can ensure that you have all of your estate planning bases covered. We recommend following it in order so that you know exactly who and want you need to account for before you start drafting the documents.
Four Signs Your Estate Plan Needs to be Updated
Even if your current estate plan covers all of the bases in our checklist, there are other signs that you need to update your estate plan. Let’s take a look at what they are.
You’ve Moved to a New State
Believe it or not, estate plans are not one-size-fits-all across the country. If you’ve moved to a new state since putting together your estate plan, you should review your new state’s relevant laws. They may seem minor, but even a minor transgression can invalidate important documents and prevent your inheritors from receiving their inheritance.
For example, there may be limitations on how much you can donate to a charity. There may also be a higher requirement of witnesses necessary to legalize certain documents. Most of the time, you will only need to make small adjustments to account for these differing laws.
Your Family Changes
Many changes can occur within your family unit that you will want to reflect in your estate planning. For example, you may divorce your previous spouse or get newly married. You may have more children or lose family members that were still alive when you first put together your estate plan.
The same can be said for any close friends, business partners, or charities you have also named as inheritors or benefactors. If you change your mind about where your assets should go after your passing (or who should take control of your estate if you become incapacitated), you will want to address those changes right away.
Your Financial Goals, Risks, or Assets Change
If you start your estate planning when you are younger, you are likely to find that your goals, risks, or assets change over time. For example, you may accrue debt that you did not previously have. You may build up new investment portfolios or open a new retirement account.
The reality is that not all of your assets do need to be accounted for in your estate plan. However, the more detailed your estate plan is, the more you can relax knowing that your assets will end up where you want them.
You Created Your Estate Plan Without an Attorney
Estate planning is a complex matter and it’s not always easy to foresee every risk that may arise in the future. Without a working knowledge of estate planning laws, it can also be difficult to make sure that all of your documents are in order.
Did you create your estate plan with the help of an attorney? If not, hire an estate planning attorney to help you review everything you already have. An attorney can make sure that all of your documents are air-tight and protect your inheritors from the risk of probate.
Cover Your Bases With an Updated Estate Plan
Having an estate plan is a great way to protect your assets, your loved ones, and any wishes you may want to be observed after you’ve passed. With our estate planning checklist, you can make sure that you do things right the first time. Then, look out for the four signs you need to update your estate plan in the future.
If you’re looking for more advice on how to navigate family law, living wills, and other important legal topics, take a look around. Bookmark our page so you know where you can return to for further legal guidance.