Springs means warmer weather and fresh starts, and for many people, spring cleaning is a seasonal rite. But spring cleaning should be more than just decluttering your closets and organizing the garage. If you haven’t addressed your legal paperwork recently, some legal spring cleaning may also be in order.
This year, while you’re deep cleaning your physical space, take some time to spring clean your legal documents. Like any purging and cleaning around the season, organizing and updating your legal documents allows you to review what you have, get rid of what you don’t need, and make necessary changes and updates that will keep you and your loved ones protected into the future.
What is Legal Spring Cleaning?
Legal spring cleaning is the process of organizing, reviewing, and refreshing your legal documents periodically. Marriage, divorce, births, deaths, financial changes — when life changes, so should your legal paperwork. If left outdated or incomplete, it can leave you unprotected and even cost you money down the road.
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Inventory and Gather Your Legal Documents
Before you can update anything, you first need to locate and review the documents you have. Collect any physical or digital copies of your:
- Will or any trusts
- Powers of attorney and advance medical directives
- Pre or postnuptial agreements
- Divorce decree and custody agreements
- Beneficiary designations for retirement accounts, investment accounts, or life insurance policies
- Financial and insurance records
- Other contracts or legal documents
If you’re like most people, you may have these documents scattered in old folders, file cabinets, email inboxes, or drawers. Unfortunately, should there be an emergency or medical crisis, your loved ones may not know where to find these important documents.
Securely consolidating everything in one place gives you an overview of your legal footprint and creates an organizational starting point. Furthermore, creating a designated and secure place for these documents allows your loved ones to know where to easily locate them if necessary.
Reviewing and Updating Documents
Once your documents are gathered and organized, you should carefully review each to ensure it still reflects your current life and wishes.
Over time, it’s easy for legal documents to become outdated. Marriages begin – or end. Children are born. Loved ones pass away. Jobs and financial situations change. Any of these life changes can affect various legal documents. Reviewing and updating documents – ideally every year – ensures they still serve your goals and protect the ones you love.
Wills and Trusts
Wills and trusts outline how you want your assets distributed and designate who you want to care for your children, among other things.
If you’ve recently experienced a marriage, divorce, birth, death in the family, or a shift in your financial situation, your will or other estate planning documents may no longer reflect your current intentions. Outdated estate planning documents mean that your assets might go to the wrong person, or your children could be placed with someone you no longer trust should something happen to you. Furthermore, probating an outdated will could become contentious and expensive for loved ones.
Beneficiary Designations
If you have accounts with beneficiary designations, such as retirement accounts and life insurance policies, you must update them directly.
When you’ve had a change in your marital status or want to add or delete someone as a beneficiary, you must contact the institution directly to make changes to accounts where you have named beneficiaries. Beneficiary designations supersede a will, so an ex-spouse could potentially receive a benefit disbursement instead of your current family members if you have not changed these designations.
Power of Attorney and Advance Medical Directive
Powers of attorney and advance medical directives name people who will speak on your behalf – financially or medically – if you can’t speak for yourself. Over time, people grow apart, move away, pass away – and this can affect your preferences as well.
If you become incapacitated without a valid power of attorney, your loved ones may have to go to court to make decisions on your behalf. The process is not just time-consuming. It is also emotionally draining and expensive. Without an updated advance medical directive, your family could struggle to make decisions during a medical emergency without knowing your preferences. Even worse, someone you wouldn’t choose to make decisions for you may end up in charge.
Custody and Child Support Agreements
Your child custody or support order was created at a specific moment in time, but your children’s needs or your life circumstances may have changed significantly. This is a good time to understand whether your current arrangement still works. Although you and your ex-spouse may have made informal adjustments as needed, if one of you fails to comply with your verbal agreement, it cannot be legally enforced, and there may also be serious consequences for violating an official court order.
If your current situation is significantly different than when your custody or support orders went into effect, you may consider reaching out to a family law attorney to discuss officially modifying the terms.
Prenuptial and Postnuptial Agreements
You may have signed a prenuptial or postnuptial agreement at some point, but life changes. You may have started a business, acquired properties, or had children.
Your pre- or postnuptial agreement should be revisited periodically to reflect your current financial picture and protect what you have built or acquired. An outdated or vague agreement could be challenged in court should something happen, and this could lead to financial loss or other outcomes that don’t reflect your original intent.
Divorce Decrees and Property Settlement Agreements
Divorce doesn’t just end with the final decree. There are usually tasks that still need to be completed, or issues addressed, such as transferring accounts, refinancing the home, or changing beneficiary designations on accounts. Leaving loose ends like this could be detrimental to you in the long-term.
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Revisit Your Financial, Insurance, and Asset Records
Once you have reviewed and updated important legal documents, you’ll also want to revisit supporting information and documents such as financial accounts, insurance policies, and an inventory of what you own.
Insurance and Investments
Are your investment accounts and life insurance policies aligned with your current life and long-term goals?
If you’ve recently changed your marital status, have you reviewed and updated your medical insurance documents? You may need to notify your insurer of your new marital status or reevaluate coverage for your children. Outdated policies and incorrect beneficiary designations can result in funds going to the wrong people. Without updates to your medical insurance, you may still be responsible for an ex-spouse, or your children could face delays in accessing necessary care. Keeping these records current ensures that your financial and medical coverage supports your life as it is today and protects your loved ones.
Updating Your Asset Inventory
Over time, you will sell or acquire new assets or open and close new accounts. If assets aren’t reflected correctly in your estate plan, they may not be distributed as you intend, or they may be overlooked entirely.
Keeping a current list of your assets, including real estate, retirement accounts, bank accounts, and valuables, ensures that you understand what your own and that your estate plan covers everything comprehensively. Not having a complete inventory can slow down estate administration and even cause disputes among your beneficiaries.
Declutter and Safeguard Your Documents
Once documents are updated, you will want to ensure that only the most current versions are accessible. Old wills, outdated powers of attorney, or obsolete documents will only create confusion and legal conflicts.
Keep your updated documents in a secure and accessible place and shred old documents that have been replaced and updated. Additionally, make sure someone you trust knows how to access your documents in case of an emergency.
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Springing Forward with Confidence
Spring cleaning isn’t just about cleaning the garage and emptying closets – it’s about making space for what matters most. Legal spring cleaning ensures that your finances and documents are updated, your affairs are in order, and your family is protected.
At Melone Hatley, P.C., our experienced family law and estate planning attorneys believe updating and keeping your documents in order is one of the most important things you can do for your legal protection and future. If you have questions about a family law or estate planning matters or aren’t sure what documents need updating, we have answers. Call us at 800-479-8124 or contact us through our website to schedule a free consultation with one of our Client Services Coordinators.
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