At some point in time, everyone should have an estate plan set up that would direct how your taxable property will be handled. This means how it will be transferred to heirs of your estate. While most people start to think about this once they get older, anyone can create an estate plan if they have property they are looking to pass on after their death. From time to time, estate plans will need to be modified to remain effective. This can happen because of a change in situation or new tax laws have come out. Whatever the case may be, it is important to review your estate plan every so often. How often should this be done? It depends on several situations.
After Major Life Events
You should always review your estate plan after a major life event has happened. Some of the major life events that would warrant a change include a divorce, a marriage, death of a heir, and more. Anytime there is a change within your heirs, you need to review your estate plan. By not doing this in a timely manner, it could get overlooked. Then, when you pass away, your estate could get held up in court for years while the courts decide how to handle it. This is the last thing you want for your property that you worked so hard for.
Change in Economy
Another time you want to be sure to review your estate plan is on a yearly basis when the economy and tax codes seem to change. The economy and tax laws can change the way you view your estate. You don’t want to leave your heirs something that will only be a burden to them. You want them to be happy with your belongings when you pass and treat them as something special. As the laws change, you may have to revise how you hand the belongings off and how much you pass on. Taxes can be real problems for those who don’t have the money to pay for them.
Every 5 Years
While you should review your estate plan annually to ensure it goes along with the latest tax codes and no major changes have happened that would affect it, you also want to review it in more detail every 5 years. This allows you to pick it apart so it is exactly what you want. In between, you can skim it without taking too much time to review it.
You don’t have to wait until a specific timeframe before you review your estate plan. Anytime you have a change in your desires for your estate, you can review your estate. The older your estate plan is the likely you are going to want to review it so you can be sure your desire for your estate is still the same. By reviewing your estate plan every so often, you can feel confident it will be taken care of after your passing.
