Life happens, people move on, we grow older, grandchildren are born. Every life event you experience should necessitate a review of your will, as an outdated estate plan could have unexpected and unpleasant consequences for your family. Here are 7 life events, you can’t ignore:
- Marriage or divorce
Marriage and divorce have a major impact on your estate plan. Most people choose to leave most of their assets to their partner. Not surprisingly, many people remember to change their will when they get married, but in the trauma of a divorce, changing your will often falls to the bottom of the to-do list. But it’s not something that should be delayed!
In terms of our Wills Act, your ex-spouse is excluded from inheriting under your pre-divorce will for a period of 3 months. But after 3 months, if you haven’t made a new will, your ex-spouse can inherit again because you are assumed to have wanted him/her to remain an heir. In practical terms, you have 3 months to get your act together and make a new will reflecting your new wishes.
- Childbirth or adoption
Adding children to your family is another life event that should trigger an immediate update of your will, so you can ensure that they are left provided for according to your wishes.
- Grandchildren
As your family grows and evolves, it’s important to consider how you want to distribute your assets amongst your younger members.
- A new job
A new job or promotion can lead to a significant boost in income, resulting in your estate being worth a lot more. Now is the time to update your will and consider your estate plan and how you would like to distribute your increased assets amongst your heirs.
Death of a family member
The death of a loved one is tragic and can have a significant impact on your will. Many married couples name their spouse as their healthcare proxy or power of attorney. Or a family member could be a trustee on a living trust. In the event of a death in your family, it is important to review your will and estate plan and make the necessary alterations.
- You receive an inheritance
If you are the beneficiary of an inheritance, you must make plans for how you may use the money in your lifetime and how you would like it distributed once you have passed away. Updating your will ensures you have complete control of who benefits from your assets.
- You have recently moved
If you have recently acquired a new home or moved to another country, it’s important to consider your will and the estates listed therein. Estate planning laws also differ from country to country. To be on the safe side, you should make updates when you change residences or move countries.
Estate planning is essential
Estate planning is the process of arranging your financial affairs in such a way that your estate and the legacy you leave are as large and well-structured as possible. A good estate plan maximises your assets and reduces your estate costs and any tax. Taxes, income tax and capital gains tax can greatly impact the size of your estate, but this can be minimised with careful planning. What’s more, a well-structured estate plan streamlines the entire process of winding up your estate, so your heirs are paid out as quickly as possible.
For expert and confidential assistance with planning your estate to ensure your loved ones are looked after, according to your wishes, speak to our Estate Planning team today.