By Beverly Kelly, Trust and Estate Specialist
Key Takeaways
- Estate planning is not just event-driven.
While major life changes often prompt updates, important risks can also develop gradually over time and should not be overlooked. - Significant financial events require immediate coordination.
Liquidity events, business changes, and relocations can introduce complex tax and structuring considerations that should be addressed promptly. - Outdated documents can lead to unintended outcomes.
Beneficiary designations, fiduciaries, and distribution plans should be reviewed regularly to ensure they continue to reflect your intentions. - The people you name matter as much as the documents themselves.
Trustees, executors, and other fiduciaries should be evaluated periodically to confirm they remain willing and able to serve. - Ongoing coordination is what makes a plan effective.
Your estate plan should remain aligned across legal documents, account titling, and your broader financial strategy through periodic review.
When to Review Your Estate Plan
An estate plan is not a static document. It is a living framework designed to reflect your life, your priorities, and the people you trust to act on your behalf. Over time, even a thoughtfully constructed plan can fall out of alignment if it is not periodically reviewed and updated.
In our experience, the most effective estate plans are those that evolve as life unfolds. Certain milestones and transitions should serve as clear signals to pause, reassess, and coordinate updates across your legal, financial, and tax framework.
Below are seven life events that should prompt an immediate estate plan review, along with guidance on what to consider in each case.
- Liquidity Events
A significant increase in wealth, whether through the sale of a business, receipt of a large bonus, or other liquidity event, should prompt immediate coordination across your planning team.
Key considerations:
- Revisiting tax-efficiency strategies within your estate plan
- Evaluating gifting strategies or trust structures
- Aligning investment strategy with long-term estate objectives
- Reviewing asset protection considerations
Liquidity events often create both opportunity and complexity. Aligning your estate plan with your financial position helps preserve and transition wealth in a manner consistent with your goals.
- Changes in Business Ownership or Structure
For business owners, estate planning and business planning are closely connected.
Key considerations:
- Updating succession plans in alignment with current ownership structure
- Revisiting buy-sell agreements or shareholder arrangements
- Coordinating estate plans with corporate governance documents
- Addressing liquidity needs for estate settlement purposes
Changes in your business can introduce new risks or opportunities that should be reflected in your estate strategy. Coordination is key to avoiding unintended disruption.
- Aging Trustees, Executors, or Other Fiduciaries
The individuals you originally named to serve in key roles may no longer be the best fit over time.
Key considerations:
- Assessing whether designated individuals remain willing and able to serve
- Evaluating the need for successor fiduciaries
- Considering the use of a corporate trustee or co-trustee structure
- Ensuring continuity and capacity for long-term administration
An effective estate plan relies heavily on the strength and reliability of those who implement it. Periodic reassessment helps ensure your chosen fiduciaries remain aligned with your needs.
- Relocation to a New State
Estate planning laws vary by state, sometimes in meaningful ways.
Key considerations:
- Validity of existing documents under your new state’s laws
- Differences in probate procedures and thresholds
- State-specific tax considerations, including estate or inheritance taxes
- Updating powers of attorney and healthcare documents to comply with local requirements
A move, particularly across state lines, is an opportune time to confirm your estate plan maintains its intended effectiveness under a new legal framework.
- Death of a Family Member or Fiduciary
The death of a spouse, parent, or named fiduciary is a natural but critical inflection point for reviewing your estate plan.
Key considerations:
- Replacing trustees, executors, or agents who are no longer able to serve
- Reallocating inheritances if a beneficiary has predeceased
- Updating guardianship provisions for minor children, if applicable
- Re-evaluating overall distribution strategy
Beyond the emotional impact, these events often expose gaps or dependencies within an estate plan that must be addressed thoughtfully.
- Divorce
A divorce can significantly alter the structure and intent of your estate plan.
Key considerations:
- Removing or revising former spouse designations across all documents
- Reassessing trustees, executors, and agents under powers of attorney
- Evaluating the impact of any ongoing obligations, such as alimony or child support
- Confirming that beneficiary designations align with your new intentions
While some changes may occur automatically under state law, many do not. A comprehensive review ensures your plan reflects your current wishes without ambiguity.
- Marriage
Marriage introduces new legal and financial dynamics that should be reflected in your estate plan.
Key considerations:
- Updating beneficiary designations on retirement accounts and insurance policies
- Revisiting wills, particularly regarding spousal provisions
- Establishing or modifying healthcare directives and powers of attorney
- Coordinating asset titling and ownership structure
Marriage is often the first time individuals integrate their financial lives with another person. Ensuring your estate plan reflects this shared structure is essential to avoid unintended outcomes.
Pulling It All Together: The Importance of Coordination
Each of these events highlights a common theme: the need for coordination. Estate planning does not exist in isolation. It intersects with your investments, financial plan, tax strategy, insurance coverage, and, in many cases, your business interests.
A periodic estate plan checkup should include:
- A review of all governing documents, including wills and trusts
- Confirmation that beneficiary designations are current and consistent
- Alignment across your advisory team, including legal, tax, and investment professionals
- Documentation of any updates in a clear and accessible format
Without this coordinated approach, even well-drafted documents can fall short of achieving their intended purpose.
Final Thought
Your estate plan is one of the most personal and impactful components of your overall financial picture. Keeping it current ensures your intentions are carried out with clarity and efficiency, and those you trust are empowered to act when it matters most.
If it has been several years since your last review, or if you have experienced any of the events outlined above, it may be time to revisit your plan with your advisory team.
Disclosure:
The information provided is for illustration purposes only. It is not, and should not, be regarded as “investment advice” or as a “recommendation” regarding a course of action to be taken. These analyses have been produced using data provided by third parties and/or public sources. While the information is believed to be reliable, its accuracy cannot be guaranteed. MONTAG employees do not provide legal or tax advice. For specific legal or tax matters, you should consult with your own legal and/or tax advisors. There are risks associated with investing in securities. Investing in stocks, bonds, exchange traded funds, mutual funds, and money market funds involve risk of loss. Loss of principal is possible.
