A number of life events can impact your will. It's important that you update or make a new will to reflect your current circumstances and wishes. This will help you to stay in control of your estate and to ensure peace of mind for those you leave behind.
There are five key times to update your will:
1. When your relationship changes
Marriage and divorce can both impact the validity of an existing will. Let’s say you have a girlfriend and you make a will leaving everything to her. Then you marry her. If you didn’t make it clear in your will that you were contemplating marriage, the marriage itself revokes the will. You may need to update the will to reflect that your then-girlfriend, now-wife should benefit from your estate.
If you’ve named your spouse as your executor, or willed any gift to your spouse and you then get divorced, the divorce makes these parts of your will invalid, even if you still want your (now ex) spouse to be included. Basically, references to your ex-spouse in your will are read as if they’ve died before you. To ensure that your ex-spouse gets what you want them to, you need to make a new will after you get divorced.
De facto relationships can also create obligations for you to consider in your will. The longer you and your partner are together the more likely it is that you will be expected to look after your partner in your will.
If you separate from your spouse or partner you may still be expected to provide for them in your will. Say, for example, you separate from your partner, but you never agree how to sort out your assets and finances together. You would still be obligated to provide for your ex in your will, even though you’re separated.
The death of a spouse not only changes who you may choose to provide for in your will but it may also lead to a change in your assets. A jointly-owned property or your spouse’s superannuation may not have been assets you previously considered in your will. But after the death of a spouse these assets may become your assets and you should think about how you want to leave them in your will..
2. When you have children
When it comes to your will, having kids is similar to getting married or making a de facto partner. You have an obligation to consider the financial needs of your children, especially if they are under 18, and adequately provide for them in your will.
Let’s say, for instance, you have two adult children from a first marriage, then you have a second relationship and have two more children. Should you die, the needs of those second children – who still have much of their childhoods ahead of them – will likely be greater than the needs of your older children. It’s important to consider these relative needs when making your will. If you don’t, expect some issues, as your will might be challenged.
3. When your assets change
When thinking about your will the most important thing to understand is whether or not an asset forms part of your estate. Your will can only control assets that are in your name when you pass away.
For example, if you own a property with your spouse as joint-proprietors, the property will automatically transfer to your spouse when you die – it does not form part of your estate. Your spouse, however, would then need to consider that asset
If you leave a property in your will but you sell it before your death then that gift will fail, even if you wanted the beneficiary of that gift to share in your estate. Basically, you can’t leave what you don’t have.
4. When you come into money
So, you won the lotto, huh? Or Uncle Bill left you a bundle when he passed away?
You should always consider what you have when making your will and deciding how to leave it. If you unexpectedly come into wealth, it’s important that you think about your will as you may be able to provide more for one or more of your beneficiaries or you may include new beneficiaries.
5. When you don’t have a will
If you die without a will, a legal formula determines where your money goes. Basically, the law will identify those people who are closest to you by family relationship. Typically, this formula starts with your spouse and children, if you have them. If you don’t, your parents, brothers and sisters or more distant relatives may share in your estate.
By having a will in place, you – and not some formula – maintain control of where your money and assets end up.
A will that is out of touch with your current circumstances may have unintended consequences – a beneficiary may be left out or their needs may not be fully provided for. This may cause your estate unnecessary legal costs, as those left behind try to deal with the impact of what you’ve left behind.
Making a new will when your circumstances change keeps you in control and ensures your current wishes are reflected.