It’s a simple fact that no one can predict the future with complete certainty, and unexpected health or financial events can occur at any time. Therefore, every adult who possesses any assets ought to make an estate plan, for the sake of the people they care about. Putting a legally enforceable plan into writing is the right thing to do for your own peace of mind and that of your loved ones. Not only that, it can help you make better monetary decisions in other ways, because the process of creating and updating an estate plan will have you get used to actively thinking about your finances.
Once you have an estate plan in place, however, it should not just be left as it is indefinitely. As your life changes, your plan will have to evolve too in order for it to continue meeting you and your family’s needs.
If you are a New Jersey resident and working on your estate plan, whether you are just starting or updating an existing plan, the team at SGW Law is here for you. Thanks to the skill and empathy of our attorneys, we can make the process of NJ estate planning much less daunting while guiding you through all relevant state regulations and requirements. Get in touch with us online today or read further on reasons to consider updating an estate plan in New Jersey.
Life Events
The purpose of each person’s estate plan is to make sure their loved ones are provided for after their passing and that there is no financial ambiguity or difficulty. With this in mind, any event in your life that causes the composition of your family to change should cause you to edit your estate plan. In fact, these kinds of life-changing events are the most important and highest-priority reason to do so.
If you get married, for example, your new spouse will have to be written into your estate plan, and if you have a child, they likewise will need to be accounted for. Most people will no longer leave assets to an ex-spouse after a divorce or separation. And in the event of the death of someone who is mentioned in your estate plan, you will need to change the distribution of assets and responsibilities. For example, if you were going to leave a piece of real estate to a sibling who predeceases you, you may want to allocate that property to their children or other heirs instead.
All of these types of events are tied up in intense emotion, both joy and sadness. Moreover, they usually take up so much time and effort on other things, like converting a room into a nursery or planning a wedding, that finances can be the last thing on your mind. You still must take some time to review your estate plan while you have all these other matters on your mind, not in spite of your loved ones but because of them.
Changes in Financial Situation
Any major shifts in your financial situation mean that you will need to specifically look at the way your assets are distributed in your estate plan. If you acquire a major new asset, such as a second home, it follows that you have to include instructions for that specific asset. Likewise, if you sell property that is listed in your estate plan, it is no longer relevant and should be removed.
An inheritance or other windfall, like a lottery win or large game show prize, is also cause to make changes. If you suddenly come into a great deal of money, it might change the way in which you’d prefer your fortune to be disbursed, such as the percentages you give to your heirs or charitable causes you care about. Finally, significant shifts in the structure or amount of your debt should make you think about changing your estate plan, on a case-by-case basis.
Relocation
Not every relocation requires major changes to an estate plan, and during busy times such as moving and getting adjusted to a new home, your mind may be otherwise occupied. However, inheritance laws differ in some important ways state-to-state, so you should look into any major dissimilarities between the law in your previous and new states of residence.
Whether you are moving to or from New Jersey, SGW Law is ready to advise you on the best steps to take regarding your estate plan. We are proud to be based in NJ, and our decades of experience with tax and other laws in the Garden State means you can be sure your estate planning will be optimized.
Legal and Tax Law Changes
The federal tax code changes in minor ways every year, and each state’s tax laws go through their own changes as well. The tax laws that are in effect at the time of a person’s death are applied when their estate plan is followed, so there is no need to constantly alter your plan based on laws that will soon be out-of-date anyway.
Nevertheless, major, lasting changes passed by Congress or state legislatures could affect your estate plan well into the future. Consulting with an attorney specializing in tax law is the best way to stay informed about these matters and what they mean for your estate planning.
Aging and Health Considerations
As we get older, the future of our family, especially children, nieces and nephews, grandchildren, or other possible heirs, becomes top of mind. For example, for many people, the retirement planning process includes making sure to have an up-to-date estate plan. Significant health events, such as disability or diagnosis of a long-term illness like diabetes or kidney disease, may also motivate you to update or start an estate plan.
Changes in Relationships
All individuals change over time. While usually any given two people can maintain the same relationship as they both grow, sometimes that’s just not possible, especially with respect to finances or estate planning. If there has been a shift in family dynamics, such as estrangement, or even you and a loved one going into business together, that means it’s a good time to edit your estate plan. Whenever you have a new intended trustee, include them in your estate plan sooner rather than later. In addition, if you have begun working with a new attorney, financial advisor, or other professional, this could mean you need to add a new executor or agent.
Regular Periodic Reviews
Even if none of the above considerations apply to you in the recent past, regularly going over your estate plan is beneficial in a number of ways. You should plan to review your plan and associated documents every three to five years no matter what happens. When you do so, you may find the plan is still sufficient for you and your family – or you may discover changes need to be made that you didn’t even think about.
Digital and Online Asset Changes
Currently, the vast majority of people who own shares in stocks, bonds, mutual funds, and other financial instruments manage their portfolio online. Furthermore, some investors have assets that only exist digitally in the first place, such as cryptocurrency. This means that as part of your estate plan, your executors, agents, and heirs will need to gain access to your investment accounts. If you change a password, your brokerage switches to a different website platform, or anything else involving account access occurs, make sure this is reflected in your estate planning.
Who Should Have an Estate Plan?
Although estate planning is most important for older people, especially those nearing retirement, the unpredictability of life means that every adult would be well advised to have an estate plan. No matter your age, health, or current finances, you and those you love will feel better knowing there is a plan for the future of your estate, whatever it may contain. Moreover, it’s important to also realize that editing an estate plan as your needs change is a lot faster than starting one from scratch later in life. If you have dependents of any kind, these points are even more important.
Contact Our NJ Estate Attorneys
The benefits of having an updated estate plan are many, and you don’t have to undertake this task alone. SGW Law strives to make NJ estate planning easy, simple, and effective. Even if you have no idea where to start, our team of attorneys will guide you every step of the way with your estate plan. Contact us now to get started making or updating an estate plan in New Jersey.