Estate planning is a deeply personal process that requires reflection concerning one’s personal circumstances and relationships. Frequently, those establishing estate plans focus on protecting their loved ones. They may also empower the people closest to them to hold positions of authority as they age or after they die.
Certain shifts in family circumstances may warrant revisions to estate planning paperwork. For example, divorce or the birth of a child can make changes to beneficiary designations necessary. In some scenarios, people may need to revisit their estate planning paperwork because a loved one died.
How can the death of a family member affect an estate plan?
Removing the deceased individual is often necessary
Close family members, including children and spouses, are often the main beneficiaries of estate plans. Testators may need to remove the deceased individual as a beneficiary and then make decisions about how to reallocate their inheritance to others. The failure to do so could lead to claims of outdated and inaccurate documents after their passing.
They may also need to address any authority granted to the deceased individual. Perhaps the testator named them as their trustee or personal representative. They may have to choose someone else to fill that role. They may also want to take this opportunity to name an alternate in case another family tragedy occurs before their passing. Perhaps they named the deceased individual as their agent or attorney-in-fact in power of attorney paperwork. They may need to evaluate the people closest to them carefully so that they can select an appropriate candidate to take over that role.
In some cases, testators may even need to modify documents that are not directly part of the estate plan. They may need to file updated life insurance beneficiary designations or alter transfer on death paperwork filed with the financial institution.
Probate can highlight gaps in a plan
Witnessing the administration of a loved one’s estate can be a difficult process. Family members frequently fight over the assets in an estate, and numerous complications can arise. Seeing what happens during the administration of a loved one’s estate can help people recognize gaps in their own estate planning documents. They may need to draft additional paperwork, commit to routine updates or add additional terms to their documents to better protect their loved ones and their intended legacy.
Losing a loved one is a tragedy, and it may require a careful review of estate planning documentation by those left behind. Updating an estate plan when a loved one dies can be a smart move.