If you have an estate plan in Colorado, you’ve started on a great path. In fact, you are among the few Americans who have taken action to secure their future and that of their loved ones. However, creating an estate plan is not enough; some may even be invalidated in court if they are outdated or don’t take into account the current circumstances of your life and the law. So to make your plan as solid as it should be, it is recommended to keep reviewing and revising it every one to three years or after the following major life changes.
Change in residency
If you were living in another state with your family and until recently decided to move to Colorado, it’s important to review your estate planning documents to ensure that they match the state’s laws. For example, Colorado is an equitable distribution state. This means that courts do not assume that all property acquired during the course of marriage equally belongs to both partners. Therefore, if the state that you lived in when you made the plan was not an equitable distribution state, your plans would need to be updated.
Changes in family structure
If you or someone in your family has gotten married, divorced, had children or experienced the death of a loved one, your estate plan should be updated to reflect these changes. For example, if you get married, you will probably want to name your spouse as the primary beneficiary of your assets. On the other hand, if you get divorced, the opposite will likely be true.
If there’s a change in federal or state laws that would impact taxes, probate or asset distribution in your estate plan, then you will want to update your estate planning documents. For example, by being aware of the current tax exemption limit, you can know how much to gift your family or put in a trust to avoid harsh tax consequences.
Documents like last will and testament, living trusts, durable power of attorney and health care directives are the most sensitive to changes in your life because they deal with the distribution of your assets and how you want things to be handled in the event of your death or incapacity. So if any major changes occur in your life, reviewing these documents and making sure they are still valid and reflect your wishes is highly recommended.