Creating an estate plan often requires the consideration of unpleasant concepts. People have to think about what happens if they die early or if they have some medical emergency. Wills and other estate planning documents protect the legacy and loved ones of the testator who drafted the documents.
They can also protect that individual when they are in a vulnerable situation, such as when they experience incapacity caused by a car crash. Occasionally reviewing and updating estate planning paperwork helps ensure that documents are valid and that they accurately convey someone’s wishes.
People often recognize that they need to update their wills after significant changes in their families or personal lives. What other documents in an estate plan may require occasional review and modification?
Powers of attorney
Incapacity is not a common experience, but it could have dire implications for an individual without the right plans in place. Reviewing powers of attorney can help protect someone by ensuring the right people handle their personal matters effectively. For example, the level of support needed to manage their financial matters may change, especially as they age. Additionally, one may need to name another agent to handle their affairs if that agent is no longer able to serve effectively (e.g., agent’s declining health, or change in the relationship with the agent).
Advance medical directives
Advance medical directives allow one to specify their preferences for medical treatment in the event they are unable to make such decisions for themselves. These preferences can change substantially throughout their life. For example, someone who is young and relatively healthy may want to receive any and all treatments and interventions to sustain their life in an emergency. Whereas, someone who is very old or suffering from a terminal illness may not want to be resuscitated or receive other lifesaving emergency procedures. Additionally, advance medical directives allow one to designate another person to make medical decisions on their behalf in the event they are unable to do so. The preferred person to handle those decisions can also change throughout one’s life.
Paperwork filed with businesses
Financial institutions and insurance providers often require special paperwork. Beneficiary designations with insurance companies determine who the company pays benefits to after someone dies. Transfer-on-death paperwork filed with a bank or investment brokerage can ensure the prompt transfer of ownership of financial assets. Valuable resources, like someone’s retirement savings account, do not have to pass through probate court with the right paperwork on record. A pre-selected beneficiary can assume ownership of the account after the primary account holder dies.
Making occasional updates to existing estate planning paperwork can help ensure that someone receives appropriate support in an emergency and that the right people have protection if anything happens to a testator. Those who review their documents after major life events and every few years can feel more confident about their documents truly protecting them and the people they love.
