Many people find the estate planning process unpleasant. They don’t like to think about leaving their loved ones or experiencing an emergency, so they delay the process as long as they can or rush through it. Once they have documents in place, they may act as though they never need to revisit the matter again.
Technically, legally valid documents could retain their authority indefinitely. A will could guide estate administration decades after a testator drafts it. However, the chances are good that their situation may have changed enough to render their documents outdated and therefore highly inaccurate. Generally speaking, it is a smart move to review and update estate planning paperwork routinely as personal circumstances change.
Why is it so important to modify existing estate plans?
To prevent conflict
As relationships shift over time, the pool of people who may expect to inherit from an estate could expand. As an individual has children and then grandchildren, there may be more people with an interest in their estate. Documents drafted years ago may not include all of the people who could be beneficiaries of the estate. Those excluded from the documents could contest the will during probate proceedings, which could lead to irrevocable damage to family relationships.
To prevent confusion
Outdated estate planning documents could include beneficiaries who have died or who no longer have close relationships with an individual. Other times, the inheritance allocated for certain beneficiaries could consist of assets that the decedent had long since liquidated at the time of their passing. The personal representative administering the estate and those waiting to receive an inheritance may feel confused about how to adjust the distribution of assets when the estate plan includes outdated terms. Updating documents to remove beneficiaries and change bequests as circumstances evolve helps prevent confusion about what the testator truly wanted.
To prevent a diminished legacy
If there is a conflict that requires probate court intervention, the estate has to cover litigation costs. Court expenses and attorney fees while defending an outdated will or resolving disputes among beneficiaries could consume a significant portion of the estate’s resources, resulting in a significantly diminished inheritance for individual beneficiaries.
Updating an estate plan when family circumstances change and when personal assets shift can reduce the likelihood of conflict, litigation and resentment. Testators may benefit from updating their documents every few years and after any drastic changes to their personal circumstances.