How Often Should You Update Your Plan?
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Your estate plan isn't a set-it-and-forget-it document. Life changes constantly. Your plan needs to keep up. But how often should you actually review and update it? The answer depends on your situation, but there are some general guidelines that work for most people.
The Standard Rule: Every 3-5 Years
Most estate planning attorneys recommend reviewing your plan every three to five years. This timeline strikes a good balance. It's frequent enough to catch major changes in your life. But it's not so often that it becomes a burden.
Think of it like getting a physical checkup. You don't need to go every month, but waiting ten years isn't wise either. Three to five years gives you enough time for meaningful changes to occur in your life, finances, or family situation. During these regular check-ins, you'll want to examine not just your basic will, but also consider whether you need additional tools like what you might need besides a living trust to properly protect your assets.
Life Events That Require Immediate Updates
Some situations can't wait for your regular review cycle. These major life events should trigger an immediate plan update:
- Marriage or Divorce: Your spouse's legal status changes everything about inheritance and decision-making authority.
- Birth or Adoption: New children need to be included as beneficiaries and may require guardianship provisions.
- Death of Beneficiaries: If someone named in your plan dies, you need new backup options.
- Significant Wealth Changes: Major increases or decreases in assets may require different planning strategies.
- Moving to Another State: Different states have different laws that could affect your plan's validity.
- Health Changes: Serious illness might change your priorities or timeline for distributions.
- Changes in Relationships: Falling out with executors or trustees means finding new ones.
Why Everyone Needs to Stay Current
Many people create an estate plan and then forget about it entirely. This approach can backfire spectacularly. Laws change. Family dynamics shift. Financial situations evolve. What made perfect sense five years ago might be completely wrong today.
Consider this: if you haven't looked at your plan in a decade, you might discover that your primary beneficiary is an ex-spouse you haven't spoken to in years. Or maybe you named your best friend as executor, but they've since developed serious health problems that make them unsuitable for the role. These oversights can create expensive legal battles and emotional turmoil for your loved ones. Understanding why everyone needs an estate plan is just the first step—maintaining it properly is equally crucial.
Comparing Different Update Schedules
Let's look at how different review frequencies compare:
Annual Reviews
Pros: You catch changes quickly. Nothing gets missed for long. You stay very current with tax law changes. Your plan remains razor-sharp and responsive to your current situation.
Cons: It's expensive if you pay attorney fees each time. Most years, nothing significant changes. You might over-adjust for temporary situations. The constant tinkering can sometimes create more problems than it solves.
Best for: People with very complex estates, business owners, or those going through major life transitions.
3-5 Year Reviews
Pros: Good balance of staying current without overdoing it. Cost-effective approach. Allows time for real changes to develop. Prevents both neglect and obsessive over-management of your estate planning documents.
Cons: Might miss some opportunities. Could leave outdated provisions in place too long. Some beneficial tax strategies or family changes might go unaddressed for several years.
Best for: Most people with stable family and financial situations.
Only When Major Events Happen
Pros: Lowest cost approach. Updates happen when they're truly needed. No wasted time on unnecessary revisions during stable periods.
Cons: Easy to procrastinate. Might miss gradual changes. Tax laws change without triggering updates. People often forget to update even after major events because they're dealing with the emotional aspects of those changes.
Best for: People with very simple estates and stable life situations.
A Real Example
Let's say Sarah created her estate plan in 2020. She was single, owned a condo worth $300,000, and had $100,000 in retirement accounts. She named her sister as executor and beneficiary.
By 2023, a lot had changed. Sarah got married, bought a house with her spouse, and inherited $200,000 from her grandmother. Her old plan would leave everything to her sister, cutting out her new husband entirely. Plus, her sister moved across the country and doesn't want to be executor anymore. Sarah also realized that with her increased assets, she might benefit from exploring what a living trust could offer in terms of probate avoidance and privacy protection.
If Sarah had followed the 3-5 year rule, she would have reviewed her plan in 2023-2025. But the marriage should have triggered an immediate update. Waiting could have created serious problems for her family. Her new husband would have no legal rights to their shared home, and her sister would be stuck dealing with an estate she's not equipped to handle from across the country.
What Changes During Updates
When you update your plan, several things might need attention:
- Beneficiary designations on retirement accounts and insurance policies
- Executor and trustee selections based on current relationships and abilities
- Guardian choices for minor children if your preferences changed
- Distribution instructions reflecting new family members or changed relationships
- Tax strategies adapting to new laws or wealth levels
- Healthcare directives updating medical preferences or agent choices
- Trust provisions that may need modification based on changing circumstances or beneficiary needs
- Digital asset management including passwords, cryptocurrency, and online accounts
- Business succession plans if you've started or sold a business
The Technology Factor
Modern life includes digital assets that didn't exist when estate planning was simpler. Cryptocurrency accounts, social media profiles, cloud storage with family photos, and online businesses all need consideration. These assets can be valuable, but they're also easily forgotten during estate planning updates.
Consider creating a separate digital asset inventory that you update more frequently than your main estate plan. This can include passwords, account information, and instructions for your digital life. Review this annually, even if you only update your main estate documents every few years.
Making Updates Manageable
Regular updates don't have to be overwhelming. Keep good records of major life changes. Make notes when things happen that might affect your plan. When review time comes, you'll have everything organized.
Consider working with the same attorney who created your original plan. They'll already understand your situation and can focus on what's changed rather than starting from scratch. This relationship continuity can save both time and money while ensuring nothing important gets overlooked.
Create a simple file or note on your phone where you jot down potential planning triggers as they happen. Got divorced? Note it. Inherited money? Write it down. Changed jobs with different benefits? Add it to the list. This running log makes your update meetings much more productive and comprehensive.
The Cost of Not Updating
People sometimes avoid updates because of the cost, but failing to update can be far more expensive. Outdated plans can result in higher taxes, probate costs, family disputes, and unintended beneficiaries receiving your assets. The few hundred or thousand dollars you spend on updates pales in comparison to these potential costs.
Think about it this way: you wouldn't drive a car for years without maintenance. Your estate plan deserves the same attention. Regular tune-ups prevent major breakdowns that cost far more to fix later.
The Bottom Line
Most people should review their estate plan every 3-5 years and update immediately after major life events. This approach keeps your plan current without creating unnecessary work or expense.
Remember, an outdated plan can be worse than no plan at all. It might distribute assets in ways you no longer want or name people who are no longer appropriate choices. Regular updates ensure your plan actually accomplishes what you intend rather than creating problems for the people you're trying to protect.
Don't let perfect be the enemy of good. Even if you can't do major updates every few years, at least review your beneficiary designations and key appointments. Small updates are better than no updates at all. Your family will thank you for staying current, and you'll have peace of mind knowing your plan reflects your actual wishes and circumstances.
