It depends what you call an 'update' and who instigates it.
If the design is open to 'updates' at the client request then that should be factored into the contract.
If, OTOH, you decide to 'update' it and its agreed by the client then you can't really charge the client for something they didn't ask for.
I used to make sure that the absolute 'end result' was always in writing (as much as it can be in the digital world) and agreed by both parties first....well before pen touches tablet.
If you've done your job right and the 'end result' is as agreed then that's when I would get the client to 'sign it off' as finished, and, from that point on, any changes would be chargeable.....whether you call them 'updates' pr not depends on your definition of 'update'.
The skill comes in getting the client to agree to the point at which 'Its finished'. A web 'design' is never really finished as it can always be added to....regardless.
This is one of the reasons I gave up on design....I would always do way more than originally specified and spend way too much time without any recompense.....and its unlikely you'll get the same 'individual' client asking for another design so it just didn't pay to be generous.
Its a tricky one, granted, and I don't think there is a definitive answer...you just have to go with the flow and use your best judgement.....which is hopefully better than mine!
Web design is easy......dealing with the client is the difficult part.
Regards.
MrToM.