Why It Matters:
Your client’s will is a living document, as long as they’re still living.
Help your clients understand the importance of maintaining their estate documents as their life goes through milestones and changes.
Without proper maintenance, your clients may be leaving their assets and final wishes up to chance.
If your clients have experienced any of the following life events, then it may be time to consider striking up a conversation about reviewing their estate plan.
It’s easy for estate planning to get put on the back burner in the midst of planning a wedding or honeymoon, but it’s the perfect time to talk to your clients about updating beneficiaries.
Suggested client reading: The Financial Checklist for Newleyweds
Here’s why it’s important to make updates at the onset of marriage — your client’s money may not automatically go to their spouse when they die. This is a good time to remind them that, upon their death, nothing is certain if it isn’t specified in writing.
Whether a client wants to completely erase an ex from their will or set up a trust for legal obligations to co-parented children, it’s important to update all documents that name the now ex-spouse to whatever the new situation is.
Here’s a short list of other things they may need to update after a divorce:
- Beneficiary designations (examples: life insurance or retirement accounts)
- Emergency contacts.
- Shared passwords.
- Power of attorney.
- Health care proxy.
Adding a new dependent to the family, be it a natural-born child, adopted, step-child, or an elderly family member they are caring for, clients should consider updating their will to reflect this new financial responsibility. This could include naming guardians for children and creating a new list of beneficiaries.
If a client outlives someone named in their will, they should consider updating their paperwork. Also, if their health care proxy, power of attorney, or executor dies, they may need to do the following:
- Name new primary ones.
- Potentially elevate their alternates to the primary position.
- Name new alternates.
Chronic or serious illnesses, disabilities, or loss of mental competence can all cause hardship. Consider showing your client your state’s advance directive form to help them think through and document who they would like to name as the trusted person to help with all legal, medical, and financial matters in the case of incapacitation.
Suggested client reading: At A Glance: Diagnosed With Serious Illness
Moving to a new state
As you may know, federal and state laws can change at any time. If a client moves to a new state, consider what new documents may be required for the local law. For example, the advance directive from an old state might not hold up in the new one.
Making more money
Salary increases, lottery winnings, buying a new home, all of these things may require additional consideration to protect a client’s financial security. If your client’s financial situation has turned for the better, it may be time to update their estate plans and trusts.
Suggested client reading: What You Should Do If You Receive a Large Cash Windfall
Things to Consider:
Clients may think a will is all about money, but it also includes naming who can help make decisions for them, and who will manage their estate once they’re gone.
Other life events such as payday increases, new pricey assets, and sudden windfalls are all reasons for clients to consider updating or creating an estate plan.
Clients may not feel a sense of urgency to update their will as their life changes, but a reminder to take the time now can save them — and their loved ones — stress and heartache down the road.
This article is provided by Everplans — a life and legacy planning company dedicated to transforming the way people get their families organized. For more information, visit: everplans.com
Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.