Individuals often ask Houston estate planning attorneys about some of the worst mistakes that can occur during—or after—the estate planning process. One of these fatal errors is when estate plans are not updated as the person’s situation in life changes. An estate plan—detailing who the person would like to receive their assets after their death—is based on the individual’s relationships at the time the estate plan is drafted. However, throughout the years, relationships and situations change that might precipitate the need to change the plan. Because it can be confusing to know if an estate plan needs updating, below are common questions and answers about this topic.
What Are Some Common Life Changes that May Alter an Estate Plan?
Common examples of life changes that may impact an estate plan include divorce or change in relationship status, the birth of a child, or the death of a loved one. In the case of divorce, there is often a need to change estate plan documents after the divorce is finalized. In many cases, spouses are named as beneficiaries in wills, life insurance, and retirement plans. However, if the beneficiary listed is not changed by an attorney, the ex-spouse will likely receive the listed policy or asset if the person dies.
It is also important to update an estate plan when an estate plan has already been drafted and then a couple has another child. If the new addition to the family is not listed as a beneficiary in the will, there is the potential for them to receive nothing from the estate—solely because the estate plan was not updated.
Additionally, if your named executor and/or beneficiary predeceases you, it’s a good idea to go ahead and draft a new will so that your assets go to who you intend it to.
What Should I Do if I Have Gone Through a Major Life Change?
When a person’s situation has changed—either in one of the examples discussed above or in another way—they should first contact an estate planning attorney. Attorneys often stay in contact with their clients; however, they generally will not know when a client’s life circumstances have been altered. Therefore, it is important for clients to contact their estate planning attorney so they can advise them on any necessary changes to their plan. While it may seem extreme to contact an attorney after every major life change, it is better to reach out and get an expert opinion than have loved ones scrambling after the person’s death because the estate plan is inaccurate. For example, there have been occasions when all of the beneficiaries listed on an individual’s estate plan have preceded them in death—this could lead to a difficult situation where the court must determine who will receive the person’s assets.
As the above example shows, it is essential to update estate plans throughout the years. Because of this, individuals who have not updated their plans in years should contact an experienced estate planning attorney.
Contact a Texas Estate Planning Attorney
If you or a loved one believes their estate plan may need updating, contact the Houston estate planning attorneys at McCulloch & Miller, PLLC. Because it may be difficult to know whether an event will trigger a change in your estate plan, our knowledgeable attorneys are here to answer your questions and help you navigate the process. For a consultation with one of our attorneys, call us today at 713-333-8900.