The holiday season has arrived. It’s time to be with our loved ones. It’s also time to review your estate planning decisions. Why? The changes that may have occurred over the last year could affect how your estate is administrated when you pass away. In this post, we’re going to discuss some of the most common changes that mean you should consider revisiting the estate planning process.
Divorce or Marriage
One of the main reasons that estate planning happens is so that the person realizes that their family, particularly their spouse, will be taken care of when they die. While there are some laws on the books regarding divorce and how it would affect whether a former spouse could inherit, there may be components of the estate plan that weren’t changed after the divorce to reflect a new beneficiary. For example, a life insurance policy, an accidental death policy, or the beneficiary of a checking or savings account. The insurance company and the bank will simply pay out the proceeds to whomever is named as beneficiary. If you’ve gotten a divorce this year, make sure that you review the beneficiaries on all of your insurance policies, bank accounts, annuities, and trusts. If you initially named your former spouse as your estate administrator or listed them as your attorney-in-fact in your will, power of attorney, or advance healthcare directive, you may very well want to consider changing those.
If you married during the last year, it’s also important to review or start the estate planning process. Even if you and your new spouse aren’t starting out with many assets, creating an estate plan that includes a will, power of attorney, and advance directive can be highly beneficial. An estate planning lawyer can also help you design a plan that will minimize estate taxes.
Birth or Adoption of a Child
Children are a wonderful gift. Estate planning fulfills two important roles. First, it provides you with a way to support your children after your death. Second, it also helps by providing you with a way to name someone you want to take care of your children if you die and they’re minors. Additionally, it protects any assets (including money and property) until your children reach the age you designate.
An estate plan is also important if you’re the parent of a special needs child. Children grow up. Estate planning is the best tool you can use to make sure that they’re taken care of for their entire life when you die. You can set aside money for specific purposes, appoint a guardian, and help your adult child have the best life possible.
The Inheritance of Purchase of Valuable Property
Property can be many things: real estate, fine jewelry, raw property, or valuable artwork. You could also inherit money. If you inherit real property as opposed to money, you need to make sure it’s included in your estate plan. Depending on its value, you may also need to have the item appraised on a regular basis for estate purposes.