This is not an article for old people or people undergoing surgery. If you have any type of life insurance or have total assets worth more than a few thousand dollars, you should have a will. The type of will being discussed here is not a Living Will that determines who makes your decisions for you if you are gravely ill (though you should also have one of those as well). This is about dividing up your financial and property estate after your death.
Your estate is not just about money. It includes things like mementos that have personal and sentimental value such as family photographs, movies, historical documents, and family heirlooms. You should ensure the items that you treasure the most will be placed in the hands of the person who is most likely to attach the same value to them as you do. If you leave large sums of money to be divided up, expect that whoever you pass the wealth down to they will (and should) spend at least some of it.
Life is all about change, which means that there are times in life that require you to change your will. Some changes will be more important than others, and most will fit into the “unexpected” category. So here is a short list of the times when changing your will is likely to make a huge difference in the event of your unexpected death.
1. Adding a child or grandchild to the family.
This is one of the more obvious reasons, as your assets now have one or more people to take into consideration. One reason to do it right away is because while they are still babies they haven’t had the opportunity to do anything to disinherit themselves. That makes it more of an objective rather than subjective decision. Another reason is you can make the changes and then focus on enjoying them as they grow up.
2. Subtracting a family member due to death.
This is the opposite of #1, but it is actually more important to do it when a death occurs. First, it can cause confusion and lead to conflict when your will is executed. Second, depending on the laws in your state, the inheritance may be passed on to someone who was the last person you would want to share in your prosperity. Finally, the State may have the last word in the argument, which generally means your estate will be spent by the government.
3. Separation and divorce.
The rule is: if you legally separate, treat it as a divorce until things return to normal. If something happens to you while legally separated the last written will is to be enforced. That makes it possible for the man or woman you planned to divorce to not get just half, but almost everything you have amassed. That possibility will not likely be part of the plan. That change in marital status may also complicate the division of property when it comes to any minor children you have.
4. Your pot of gold gets bigger or smaller.
OK, maybe it is their pot of gold, but if it gets bigger there may be people you want to add or reapportion the increase differently. If you hit hard times and your estate balance shrinks, you may have to make some hard decisions about who will have to get a smaller piece of the pie, or get left out altogether. But be sure to separate cash from everything else. Diving an amount of cash 6 ways is different than dividing a piece of real estate 6 ways. The value of your assets is the important factor.
5. Changes in the law.
Despite all the negative stereotypes about lawyers, there are a number of times they are very useful. Every time you hear on the news or read about changes in tax laws, there is a good possibility it will affect your estate, and by extension, your will. But keep up with every small change in the law isn’t something most people are likely to do – which is why you hire a competent lawyer to do it for you. Avoid the Internet versions of what is and isn’t important regarding your will. Hire and retain a competent attorney to keep you up to date, and perhaps another attorney to sue him if he falls asleep at the wheel.
These are the basic times when updating your will is critical. But everybody’s personal situation is different, so be sure to look at the specifics of your will several times during the year, even when none of these events take place in your life. You may be able to control some aspects of your life, but not all of them. That is why a will is an essential tool if you have any assets at all.
When looking over your will to make changes, be sure to make sure everyone in the will is living, and that they haven’t remarried. For many people, the purpose of a will is make the lives of loved ones better. One of my college professors said that if you have money your children will always come to visit you. Something to think about at any age.